This month sees the publication of a report by Friends of the Earth (FoE), entitled “A Dangerous Obsession – The Evidence Against Carbon Trading And For Real Solutions To Avoid A Climate Crunch”, which joins the growing body of criticism for a scheme that promotes that most discredited of climate actions, offsetting, and calls for more meaningful initiatives to ensure that we reach the 2015 crunch targets for emissions reduction.

It points out that the global carbon market has roughly doubled in size every year since 2005, already worth US$126 billion in 2008, and is predicted to grow to a market value of US$3.1 trillion per year by 2020. It identifies six central problems with carbon trading, namely that it:

1. Is ineffective at driving emissions reductions
2. Fails to drive technological innovation
3. Leads to lock-in of high-carbon infrastructure
4. Allows for, and relies on, offsetting
5. Creates a risk of subprime carbon, and
6. Provides a smokescreen for lack of action on climate finance by the developed world.

The full report can be read here (http://www.foe.co.uk/resource/reports/dangerous_obsession..pdf) and merits reading even if you only get as far as perusing the executive summary.

Whereas, in the past, we might have dismissed this as the rantings of the apocalypse lobby, this can no longer be the case; in the first instance because the report draws on established economic data and methodology and, in the second place, because the views expressed in the report are echoed by respected voices in the commercial and financial sector.

In support, though entirely independent, in the same week that the report was published, a report was also published by Deutsche Bank’s Asset Management division (DeAM), entitled “Global Climate Change Policy Tracker: An Investor’s Assessment” (download it here http://www.dbcca.com/dbcca/EN/investment-research/investment_research_1780.jsp) and guess what? This report mirrors everything that FoE say in their report.

Essentially, if we rely on a carbon trading market to assuage our feelings of guilt about not doing anything, we are fast creating the conditions where we will manufacture a sub-prime mountain of unregulated, auctioned-at-any-and-every-price carbon credits whilst diverting any available investment away from actual carbon emissions reduction measures, investment in green tech and support for struggling third world nations in their endeavours to balance economic development with sustainability.

What is more worrying is that, despite the growing call for a re-assessment of the validity and relevance of the CRC scheme in tackling the real threat of climate change, the Copenhagen Climate Change Summit may be genuinely concerned about the potential impact of climate change - but the goals of the parties present will be to agree to a treaty which achieves the common good whilst having as little negative impact on their own country as possible, almost guaranteeing that carbon trading will take centre stage as the demonstration of political will to the exclusion of all else, excepting agreement to ring fence funds for third world green investment (without, in all likelihood, any mechanism for proving that the money goes where its supposed to… and when).

We are now at a stage where numerous respected voices from all sectors of the commercial, as well as the environmental, community have spoken with authority, backing up the arguments with science and sound economics. The question remains as to how long it will take before the politicians admit that the CRC scheme is no more real, as a mechanism for necessary change, than the Emperor’s new clothes and commit to tangible and significant actions… preferably in Copenhagen next month.

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