EU Carbon Trading Network Takes Off In 2005 - Nature

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"Activity on the international carbon-trading market has grown following the launch of the European Union's Emissions Trading Scheme on 1 January. The volume of trading had already doubled in both November and December 2004. The idea of a carbon market is to allow industrial organizations such as power companies and factories to buy and sell the right to emit greenhouse gases such as carbon dioxide.

And companies have been trading in carbon emissions voluntarily since 1998 (see "The carbon game"). But 2005 has seen the advent of a Europe-wide scheme that will standardize the process and prepare the union for the forthcoming implementation of the Kyoto Protocol. The project is a step up from smaller US schemes and involves some 12,700 organizations in the union's 25 member states.

Each state is given a national allocation of carbon credits, with the aim of cutting emissions by around 1% a year during the project's first phase, which runs until 2007. It then farms these out to individual companies.

EDIT

The amount of activity on the market has grown exponentially in recent months as traders readied themselves for the European scheme. On 6 January, brokers oversaw deals involving some 600,000 tonnes of carbon dioxide emissions, says Reena Qureshi of London-based brokers CO2e.com. And this daily total looks likely to grow steadily, as more traders join the market. Prices on the market have decreased since the end of December, however. The price of a tonne of carbon dioxide credit has fallen by about a euro, from 8.5 to 7.65."

EDIT

http://www.nature.com/news/2005/050103/full/050103-11.html