THE ESTABLISHMENT of Ireland's first State-backed voluntary carbon registry has emerged as the key recommendation of the final "Green IFSC" proposal, The Irish Times has learned.
The initiative will involve a €6.8 million investment by the State over three years, as well as an expected €1.5 million investment from the private sector.
Despite the fragile political climate, it is understood the Green Party is keen to bring the final proposal to Cabinet as early as next Tuesday, with a launch scheduled for next month. A copy of the final memo was circulated to Ministers last week, though it is understood that some Ministers have raised questions.
Fine Gael’s Richard Bruton, said his party is “sympathetic to the concept of the Green IFSC” and would look at the specific merits of the business plan.
The idea for a Green IFSC, which would see Ireland becoming a centre for green finance, has been in the pipeline for almost two years. The final result is a culmination of work carried out by the Green IFSC Steering Group – a branch of the IFSC Clearing House Group – which operates under the aegis of the Department of the Taoiseach.
The Green IFSC proposal also received a boost yesterday, with the announcement in the Finance Bill that tax reliefs will be extended to carbon offsets.
A key strand of the final proposal for the Green IFSC is the creation of an International Carbon Standard for Ireland and an associated registry for carbon credits which will be known as the Dublin International Voluntary Offset Registry (Divor). Like most European countries, Ireland has a carbon emissions trading registry which is run by the Environmental Protection Agency.
While there are a number of private voluntary carbon offset schemes operating in Ireland, such as Cosain, Divor would be the first government-backed voluntary carbon market which would allow companies, which are not complied to buy credits to offset part of their emissions, to do so voluntarily.
Supporters argue that the establishment of an internationally-recognised International Carbon Standard (ICS) by Ireland is essential if it is to differentiate itself from other green finance hubs such as Toronto, Singapore and London.
It is believed the first challenge facing the initiative will be securing the support of other international exchanges and trading centres.
Some €2.9 million of the total €6.8 million of the Government investment has been earmarked for the first year. This will cover set-up costs, as well as the cost of operating and managing the registry and ICS.
It is envisaged that a dedicated project team will report to the Clearing House Group for two years.
Carbon trading and the voluntary carbon offset market, is a burgeoning industry. Estimates suggest that revenues will hit $20 billion by 2020. According to McKinsey, carbon market traded volumes will exceed $1 trillion by 2020.
