President establishes a market for carbon credits

President Laura Chinchilla launched a domestic carbon credit market Tuesday.

The market allows firms to purchase unidades costarricenses de compensación to offset the carbon emissions they cannot eliminate by other means.

The program is sponsored by a $3.5 million grant from the government of Germany. The Costa Rican central government has pledged that the country will reach carbon neutrality by 2021. The measurements do not appear to take into account the vast releases of gases by the country’s active volcanoes.

The carbon offsets will be balanced out by forestry credits, according to Casa Presidencial. It appears that so far the program is voluntary. The summary of the program said that the carbon credits would guarantee protection of the forests and encourage reforestation. Trees store carbon temporarily in their wood fibers and then release it after death and upon decay.

The Instituto de Normas Técnicas de Costa Rica already is established and capable of measuring carbon footprints of businesses.

The announcement is not unexpected. The environmental ministry received $3 million from a World Bank agency to structure  a carbon trading scheme last March.

The project and the entire system of carbon credits is based on the assumption that the release of carbon dioxide by humans and their modern machinery is central to the increase in global temperatures. That is what the Intergovernmental Panel on Climate Change said.

Although the carbon credit program was called domestic, the country’s officials have long dreamed of being able to market carbon credits to the industrialized world on the assumption that the carbon sequestered by the country’s trees and other vegetation can be measured accurately and sold.

René Castro was quoted in a March release from the  Ministerio de Ambiente y Energía that he heads saying that the carbon credits are an instrument for voluntary goals.

Ms. Chinchilla said that Costa Rica was the first country in development to set up a carbon trading market.

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