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  • Writer's pictureGeneral Carbon

Summary of ‘Carbon Market Survey 2016’

Thomson Reuters recently released ‘Carbon Market Survey 2016’ – Will Paris be a catalyst for more emission trading?[1] and we are summarising its main findings for the CDM stakeholders.

The survey has analysed response of total 1,518 respondents and 286 of these have identified themselves as CDM stakeholders and 501 that to EU ETS.

  1. For cap-and-trade as policy instrument, majority of the respondents , about 69% see it as “not perfect but the best we can agree on”; 23% consider it an ideal instrument and 8% are of the opinion that it does more harm than good. The number of respondents over the three years of survey those who believe it as a good instrument is also constant around 70%.

  2. About 50% respondents said they are satisfied with the Paris Agreement, but most of them do not believe it will set the world on track to reach 2 degrees target.

  3. Just 25% respondents expect CDM demand to increase compared to that in 2015.

  4. The new demand for CDM is expected, as per the respondent, from the voluntary markets, international aviation and shipping.

According to the submitted Internal Nationally Determined Contributions (INDC) only the following countries have indicated they will/ might use international market mechanisms to meet their climate targets: Canada, Japan, New Zealand, South Korea, Switzerland and possibly Norway.

The CER issuance has come down significantly to about 9 million units per month on average due to low price. The price is ranging around 40 Euro cents, close to the average cost of issuance.

  1. As a result of the low demand, a number of project owners are considering re-classifying their projects, i.e. to re-register or incorporate them under another type of mechanism. About 30% of respondents would be willing to incorporate their CDM projects into some national (non-trading) initiative e.g. NAMA; 11% wanted to supply their credits for use in the local trading schemes and 30% respondents wish to continue with CDM.

[1] “Thomson Reuters Carbon Market Survey 2016”, Nordeng, A. et al., 30 pages.

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