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Published on November 21st, 2012 | by Silvio Marcacci


Kazakhstan Will Launch Emissions Trading System In 2013

November 21st, 2012 by  

Another day brings another major emissions reduction effort announcement, this time from mighty Kazakhstan.

Following in the footsteps of the European Union, China, South Korea, Australia, New Zealand, California, Thailand, and Vietnam; the former Soviet republic will institute a greenhouse gas emissions trading system on businesses emitting more than 20,000 tons of CO2 annually, starting January 1, 2013.

This emissions trading system, KazakhCarbon, is part of Kazakhstan’s goal of reducing its greenhouse gas emissions 15 % by 2020 and 25% by 2050, compared to 1990 levels and driven by the Kyoto Protocol.

Only 180 businesses are expected to exceed the emissions cap, but they represent 80 percent of all emissions in Kazakhstan. These large emitters will be required to submit an emissions accounting to the country’s Ministry of Environmental Protection (MEP). Companies that exceed their quota will have to purchase additional emissions allocations or risk losing their business license to operate in the country.

While being forced out of business may sound harsh, the Kazakh government will reward extra allocations to those businesses that reduce their emissions. Extra allocations can then be sold to companies that exceed their allotment, and become a revenue stream for the more efficient businesses.

The trading system is expected to increase demand for clean energy technologies and supplement existing laws that support renewable energy, energy efficiency, and energy conservation markets.

Kazakhstan’s effort is significant for two reasons, beyond the imperative of slowing global warming. First, the country is already experiencing climate change “in the form of expansion of desert and semi-desert areas, depletion of water resources, and intensified floods.” Second, the oil and gas industries represent a major portion of the country’s economy and are expected to grow in importance in coming years.

Faced with the choice of increasing emissions and climate change as industry increases, or using economic growth to spur a green economy comprised of energy efficiency and renewables, Kazakhstan is choosing the more sustainable path.

The Kazakh system also demonstrates a growing global market for emissions reductions, and the potential for international linkages to strengthen more mature systems like those in European Union, Australia, or even California.

Image Credit: Kazakhstan flag via Shutterstock 


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About the Author

Silvio is Principal at Marcacci Communications, a full-service clean energy and climate policy public relations company based in Oakland, CA.

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