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Jon McKee Queen Explains International Emissions Trading under the Kyoto Protocol
Jon McKee Queen is a climate change specialist adept in the fields of law, finance, corporate strategy, project development, and policy consultancy. With degrees in Economics from Cornell University and Law from the University of Pennsylvania, Queen first served as an attorney for Latham & Watkins and later as a licensed broker with John Hancock before finally entering the climate change arena.
An amendment to the UN Framework Convention on Climate Change (UNFCCC), the Kyoto Protocol binds each of the 37 participating “Annex 1” countries into meeting predetermined targets for reducing total greenhouse gas (GHG) emissions via any of three flexible market-based mechanisms – international emissions trading, clean development mechanism, and joint implementation projects. Jon McKee Queen helps participating countries towards this goal by facilitating two of the three flexible mechanisms: emissions trading and joint implementation.
Under the Protocol, each Annex 1 country has five years, from the beginning of 2008 to the end of 2012, to bring its overall GHG emissions levels down to 5% below its 1990 levels. A country’s target level is expressed as levels of allowed emissions, figures which are then divided into assigned amount of units (AAU), each AAU equivalent to one metric ton of CO2. Though each participating country is given a “cap” for allowable emissions by being issued a number of AAUs, consumption of AAUs differs from country to country.
Since there are countries whose total GHG emissions exceed the number of AAUs assigned to them, and countries whose total GHG emissions may leave AAUs to spare, Annex 1 countries are allowed to engage in international emissions trading by either selling their AAUs for securities, or trading them for emission reduction units (ERU) or emission removal units (RMU).
Jon McKee Queen’s thoughts on climate change and clean energy investments may be read at jon-m-queen.blogspot.com.
