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Green trading arrives in the Middle East

DUBAI — London-based carbon trading organisation Advanced Global Trading, or AGT, has launched its operations in Dubai that will facilitate trading of the world’s fastest-growing commodity in the Middle East region.

AGT opened its regional headquarters in Dubai, with its traders attempting to convince increasingly environmentally-conscious investors in the region to consider ethical alternatives and potentially benefit from strong returns in the process. AGT is an industry-leader in sourcing and trading carbon credits, specialising in the trading of voluntary emissions reductions, or VERs, in the dynamic over-the-counter green market.

“Bringing green trading to the Middle East was an easy decision as it’s both ethical and profitable and the region, which has profited heavily from the Energy industry, is the obvious market to encourage investors to make returns on their investments, while benefiting the environment,” AGT partner Charles Stephenson said.

As of April 2010, 191 states including the UAE, Qatar and Kuwait, have signed and ratified the Kyoto Protocol, aimed at fighting global warming.

According to the World Bank, the global carbon trading market is now worth a phenomenal $144 billion, up six per cent from 2008 despite the global downturn, and is expected to grow to over $1 trillion by 2025. Helping the environment is now big business, with carbon credits being traded around the world by both corporate and private investors looking to profit from the carbon market boom.

Carbon or green trading is a hot topic in the region, with Dubai’s Carbon Centre of Excellence recently unveiling plans to offset five million tonnes of carbon annually.

High carbon producing companies, including DEWA, Dubal and Enoc, have also announced they are considering carbon-emission reduction quotas as part of a voluntary joint initiative.

Carbon credits are similar to certificates that represent a reduction of greenhouse gasses in the atmosphere with one carbon credit the equivalent to a saving of one tonne of CO2. Projects that prevent the generation of greenhouse gasses or remove these gasses from the atmosphere earn these credits, which can then be sold to other businesses and individuals to offset the emissions they generate.

The prices of carbon credits vary and can be volatile, creating the potential for large gains as demand grows, while also ensuring investors’ money is put into emissions reducing projects worldwide. Each carbon credit bought finances a project that is verified to reduce greenhouse gas emissions. This credit can then be sold to companies who need to comply with global targets, or to individuals who wish to profit from predicted price increases.

“Each step of the process is part of the chain that ultimately helps the environment by first creating the carbon credit and then eventually ‘retiring’ the credit against an emission,” Stephenson said.

· abdulbasit@khaleejtimes.com