The United Nations summit on climate change may prove to be a landmark event that historians will use to mark the moment when the world got serious about carbon emissions. Leading up the even in December, which will take place in Copenhagen , there have been protests, rallies, meetings atop mountains, as various organizations attempt to raise awareness about the importance of the Copenhagen summit.
Some activists are concerned that the talks will go poorly and that countries will emerge without having established strong worldwide regulations about the emissions of carbon. This failure to reach an agreement, coupled with the recession may result in carbon prices being lower than expected.
As a result of increased uncertainty about the United Nations summit actually being able to strike a deal, analyst firm Point Carbon is lowering its long term price forecasts. A recent report showed that emissions have dropped dramatically over the last year and a half, partially due to the recession cutting down travel and forcing people to be more efficient to save money. This fact, coupled with the small chance that the Copenhagen summit will actually produce results, means that the cost of European Union emissions allowances would actually be lower than expected between 2013 and 2020.
Some would say that this is a good thing but much of the incentive for consumers to lower their emissions has been financial, so if prices are lower there will be less of an incentive. The chances of a low long term carbon price may force governments to intervene to drive the price up as a way to better incentivize investments in low carbon technology.
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