Press Release
For use of information media - Not an official record

Geneva, Switzerland, 30 October 1998

The International Emissions Trading Association (IETA), an independent, non-profit, industry-led organization dedicated to advancing international cooperation in emissions trading, was established in Geneva today. IETA’s establishment was sponsored by UNCTAD and the Earth Council, a leading environmental organization.

Membership in the IETA is open to companies, government agencies, industry associations, international organizations, environmental non-governmental organizations, and individuals.

The principal objective of IETA is to serve as a forum for the exchange of ideas, information and experience relating to international greenhouse gas emissions trading, and as a vehicle for greenhouse gas emissions trading amongst its members. IETA intends to develop a system of accreditation in support of emissions trading amongst its members, to act as a depository of relevant documentation and provide a forum for arbitration and mediation.

The inaugural meeting of the IETA will be convened in Buenos Aires on 12 November 1998, in conjunction with the fourth Conference of the Parties (COP4) to the United Nations Framework Convention on Climate Change. The purpose of the inaugural meeting, to be be chaired by Mr. Maurice Strong, Chairman of the Earth Council, is to complete arrangements for its establishment, including examining its draft statutes.

The establishment of the IETA at this time marks a step forward in efforts by the international community to design and implement an international greenhouse gas emissions trading system. It follows the adoption of the Kyoto Protocol in December 1997. The Kyoto Protocol requires the industrialized countries to collectively reduce their greenhouse gas emissions by at least 5 per cent below 1990 levels in the commitment period 2008-2012. Emissions trading and other so-called "flexible mechanisms" are among an array of instruments available to governments to enable them to comply with their legally-binding obligations. Flexible mechanisms through the use of market-based instruments (such as emissions trading) are expected to occupy center-stage in Buenos Aires.

Research into the design and implementation of an international greenhouse gas emissions trading system has been conducted by UNCTAD since 1990. In 1995, UNCTAD and the Earth Council established a joint programme of cooperation on emissions trading, and launched the Greenhouse Gas Emissions Trading Policy Forum, in June 1997. The Policy Forum is dedicated to the implementation of a plurilateral greenhouse gas emissions market by the year 2000, in accordance with the Kyoto Protocol. This project will be supported by a grant of US$1.25 million from the United Nations Foundation. The IETA is expected to become the institutional successor to the Policy Forum.

The establishment of the IETA will strengthen the institutional capacity of the private sector to assist governments to design and implement a comprehensive, stable and efficient greenhouse gas emissions trading system. It will draw upon and complement the growing number of emissions trading schemes (such as BP’s internal emissions trading scheme) in helping to prepare for a smooth launch of the international emissions trading market in 2008.

By enabling interested corporate and other entities to work together, the IETA will assist with the development of international standards, protocols and guidelines for, among other things, accreditation, measuring and monitoring of emissions, verification and certification of projects and emission reductions, auditing, and trading of emission allowances and reduction credits. Developing countries and countries in transition will benefit from technical assistance, training and capacity-building. In this regard, Lloyd’s Register of Shipping is expected to play a key role in line with the terms of a joint ‘Memorandum of Understanding’ signed in May 1998.

Participants in the inaugural meeting of the IETA will include representatives of more than 30 international corporations (including Boral Energy, British Petroleum, CH2M Hill, Eastern Power & Energy Trading, Environmental Financial Products Ltd., General Motors, Green Power Corporation, International Petroleum Exchange, KPMG, Lloyd’s Register, Mobil Corporation, Mount Isa Mines, Marathon Ashland Petroleum, NYMEX, Ontario Hydro, Pilkington, Shell International, Statoil, Sydney Futures Exchange, Texaco International, Tokyo Electric Power Corporation, Toronto Stock Exchange, and UBS); several industry associations including FORATOM, International Automobile Federation (FIA), Emissions Trading Association of Australia, Latin American Trading Association, and the World Business Council for Sustainable Development (WBCSD); representatives of UNCTAD, UNDP, UNEP, UNIDO, Earth Council, and the Global Environment Facility (GEF). Representatives of two national agencies from Denmark and Panama will also attend.