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Carbon markets finance climate change activities

Ursula Heinen-Esser opens Carbon Expo

Berlin, 30 May 2012 The global carbon market’s financing function is a key component of the German government’s climate change strategy. Ursula Heinen-Esser, Parliamentary State Secretary at the German Environment Ministry, stressed this point in her opening address at this year’s Carbon Expo. However, a prerequisite for any further investment in international climate change activities is that the climate change talks move forward. “Climate change and the carbon market go hand in hand,” stressed Heinen-Esser. “The carbon market must mobilise billions in climate change investment. But to do so, it needs ambitious targets and a clear framework. These must be agreed in the climate change talks.”

The power of the carbon market was demonstrated in the first five years of the Kyoto Protocol’s existence. Thanks to its project-based mechanisms, the Clean Development Mechanism (CDM) and Joint Implementation (JI), emission reductions amounting to some 1.3 billion tonnes of greenhouse gases will be achieved by the end of this year. This is more than the total emissions in Germany in 1990, the Kyoto base year. It is expected that the reduction potential offered by the almost 10,000 CDM and JI projects now in place will rise several-fold by 2020.

“Apart from the economic dimension of international climate change projects, the CDM has heightened awareness to climate change issues in dozens of developing countries. It thus fosters acceptance of and support for global warming measures in those countries. This approach must continue,” said Heinen-Esser, adding that any further hesitance on the part of the international community would threaten not only the carbon market mechanisms, but could result in the disappearance of a key source of climate change financing. Germany thus calls for a comprehensive climate change agreement from 2020 and supports the setting of ambitious targets while continuing the Kyoto Protocol until then.