Canada outlines plan to set up market for carbon

OTTAWA (Reuters) - Canada unveiled plans on Wednesday to create a national carbon market and said it would put a price on carbon in a bid to help firms and individuals to cut emissions of greenhouses gases.

The announcement is an important step for the minority Conservative government, which opponents regularly accuse of not doing enough to protect the environment.

Environment Minister Jim Prentice did not immediately reveal what that the proposed price of carbon might be. In a speech, he said the government would put in place rules for carbon offset credits.

"The offset system will be a key part of our overall commitment. It is intended to generate real reductions on greenhouse emissions," he said.

Companies and individuals would receive the credits for investing in clean energy projects such as wind turbines. The credits can then be sold to enterprises that cannot meet their targets for emissions cuts.

The risk for the government is that the planned carbon market and credits system could be swamped by moves from the U.S. administration of President Barack Obama.

Canada had planned to impose binding emissions cuts on major enterprises in 2010. Prentice announced last month that Ottawa would delaying the introduction of the regulations until it saw what Washington was planning.

The government has pledged to cut Canada's carbon emissions 20 percent from 2006 levels by 2020.

(Reporting by David Ljunggren; editing by Peter Galloway)