The Globalization of Carbon Trading: Transnational Business Coalitions in Climate Politics

Abstract

Over the past decade, carbon trading has emerged as the policy instrument of choice in the industrialized world to address global climate change. In this article I argue that a transnational business coalition, representing mostly energy firms and energy-intensive manufacturers, actively promoted the global rise of carbon trading. In this process, business was able to draw on the support of government allies and business-oriented environmental groups, particularly in the UK and the US. Alongside its allies, the coalition had pivotal influence in the internationalization of carbon trading through the Kyoto Protocol, in the U-turn of the EU from skeptic to frontrunner on carbon trading and in the re-import of carbon trading to the US. While business was not able to prevent mandatory emission controls, it was able to critically affect the regulatory style of climate policy in favor of low-cost, market-based options. (c)© 2011 by the Massachusetts Institute of Technology.

The politics of carbon markets: an introduction

“…The majority of the work has been, perhaps unsurprisingly, on the role of business actors in these processes. Some of this is focused on the lobbying by particular industries, for example attempts to enable the inclusion of carbon capture and storage in CDM projects (Vormedal 2008), while others focus more broadly on the role of business coalitions or networks in developing carbon market policies (Pinkse and Kolk 2007, Kolk et al 2008, Meckling 2011a, 2011b, Stephan 2011, Paterson 2012.…”

Researching Global Environmental Politics in the 21st Century

“…As was true in the 1990s, much of the literature since 2000 has also analyzed how domestic and regional political economies and national security interests shape the contours of specific global environmental governance initiatives (e.g., Balsiger and VanDeveer 2012;DeSombre 2000;Hovi et al 2009;Selin 2012). It is continuing, as well, to weigh the importance of epistemic communities, domestic civil societies, and industry actors for the development of these formal governance initiatives (e.g., Betsill and Corell 2001;Clapp 2005;Meckling 2011;Paterson 2001;Wapner 2002). Yet GEP research is increasingly based on an assumption that a robust understanding of the causes and consequences of global environmental change-or the effectiveness of efforts to manage the global environment-requires a fuller analysis (at least than was common in most of the previous IR literature) of how nonstate actors and forces interact with state power (Andonova 2010;Biermann and Pattberg 2008;Boström and Hallström 2010;Clapp and Fuchs 2009;Falkner 2003).…”

“…GEP scholars have carved out a particular niche in understanding the dynamics of transnational climate governance in its many forms. The global politics of carbon emissions and carbon trading has been a prominent research theme, and researchers have helped uncover the political dynamics and roles of various actors influencing the creation and functioning of these markets (e.g., Lövbrand et al 2009;Meckling 2011;Newell and Bumpus 2012). GEP research on climate change has also advanced the understanding of multilevel governance-for instance, revealing the ways in which cities have taken a lead role in pursuing transnational climate cooperation (Andonova et al 2009;Bulkeley et al 2014).…”

The Governance Modes of the Tokyo Metropolitan Government Emissions Trading System

“…But then there are a few territories running or at least experimenting with ETS (Meckling 2011;Perdan and Azapagic 2011;World Bank 2012), and their number is growing. Among the territories where an ETS is already in place is the Tokyo prefecture, where the Metropolitan Government decided in June 2007 to implement an ETS by 2010.…”