Carbon partnership hopes to go global

By Henrique Almeida

LISBON (Reuters) - A coalition of European countries, U.S. states, Canadian provinces and New Zealand signed a partnership on Monday to slow global warming through an international carbon trading market, officials said on Monday.

The International Carbon Action Partnership (ICAP) hopes to become a stepping stone for the creation of a global market for heat-trapping gases that many scientists link to extreme weather like violent hurricanes and rising sea levels.

"We will be sending important signal to others. We will be saying to leaders across the world that we can work together to reduce emissions," said European Commission President Jose Manuel Barroso.

The European Union has taken the lead in the fight against global warming by setting up a landmark EU emissions trading scheme in 2005 which aims to reduce emissions by putting a price on carbon that businesses use.

Carbon markets allow countries and companies to meet greenhouse gas emissions targets by shopping around for the cheapest carbon offsets, but some analysts say that wide differences among proposed schemes will prevent market links.

"I firmly believe a global market for greenhouse gases will allow us to protect the environment while growing the economy," said Arnold Schwarzenegger, the Governor of California and one of ICAP's 20 founding members, in a video message.

"This partnership will provide more incentives for clean-tech investment and economic growth while not letting polluters off the hook."

At least 16 U.S. states plus New Zealand, Australia and seven Canadian provinces are investigating following a European Union's lead by launching a carbon trading scheme, as one policy tool in the fight against climate change.

SIGNATORIES

ICAP also hopes such a forum will help boost demand for low-carbon products and services that will allow for cost effective reductions in global warming emissions.

The partnership's signatories included British Prime Minister Gordon Brown, Norway, the Premier of British Columbia Gordon Campbell and New York Governor Eliot Spitzer.

Spitzer said he was disappointed that U.S. President George Bush had not signed up to this agreement but said he hoped the next president would do so.

"There is now an understanding, an agreement, of the enormity of this problem (climate change). I have no doubt that whoever succeeds President Bush will fully understand this issue," he said.

The United States is, by most counts, the world's largest producer of the heat-trapping gases but the current administration has so far rejected putting binding caps on industrial emissions of carbon dioxide.

Representatives of 180 countries will meet at the United Nations Climate Change Conference in Bali on December 3.