Buying environmental insurance: prospects for trading of global climate-protection services

Abstract

An international market in environmental services can help to safeguard the Earth's climate and foster economic development through a North-South transfer of financial resources. The authors suggest international carbon-emission offsets (ICEOs) as a means by which international markets, under a policy umbrella such as a multilateral climate-protection treaty, could trade carbon-saving services. Such a market would provide a currency for rewarding actions that reduce global carbon emissions, allowing carbon emitters to seek the least expensive ways to reduce emissions. This currency would transfer cash and/or debt relief from industrialized nations to developing nations, allowing the developing nations to profit from the use of clean energy technologies and the protection, rather than depletion, of tropical forests. -from Authors