Nothing drove home Russia's place in the growing pollution-trading business better than what one carbon finance guy told me at a conference last month sponsored by Gazprom and the World Bank. We were on drink number three or four at the reception when he dropped the green pretense and came clean.
"I don't know if climate change is caused by burning coal or sun flares or what," said the Moscow-based carbon cowboy. "And I don't really give a shit. Russia is the most energy inefficient country around, and carbon is the most volatile market ever. There's a lot of opportunity to make money".
Now that you have a taste of Russian thinking, from Bloomberg:
Russia will stockpile an estimated $58 billion in carbon-emissions credits it’s accumulating by performing better than required under the Kyoto global-warming treaty to reduce greenhouse gases.
Victor Blinov, deputy chief of Russia’s delegation to United Nations climate talks in Poland, said in an interview that credits not needed to comply with the Kyoto Protocol will be used instead for a successor treaty that’s being negotiated to take effect after 2012. None will be sold to other nations, Blinov said.
The comments may help quell speculation about what Russia will do with credits that cover releasing 3.3 billion metric tons of carbon dioxide through 2012, or about 18 months of greenhouse- gas emissions from all the factories and power plants in the 27- member European Union, according to World Bank estimates....
...Russia’s Kyoto target was to match its average annual emissions in the measurement period compared with 1990...MORE
Got that? The base year is Soviet era, before the collapse. Kyoto is as crass a money grab as any you'll find short of Hitler's theft of Europe's art treasures. And it is orders of magnitude larger than the "Rape of Europa".
From our post "Russia: What a Scam We Have in Carbon":
...Well readers you decide, has Russia figured out how to stick it to the Europeans in both the gas biz and the carbon biz, simultaneously? Da/Nyet? Your vote counts.
Alright, the nyet's have it!Europe's playing pattycake. With a stone cold killer....
This stuff isn't hard to figure out. From our May '08 post "Russia: What a Scam We Have in Carbon, part II":
...Alexander Khanykov, head of Russian clean energy project developers Carbon Project Group, told Reuters on Friday that he believes Russia will save most of its AAUs past 2012 instead of selling them and possibly flooding an already precarious carbon market....MORE
Get that? They are postponing doing anything about their emissions now, because they think the credits will be worth more down the road! Those leaky old Gazprom pipes are a bargaining chip for $30 to $60 Billion dollars. Or nothing, if the Europeans quit the game (just a thought).
It's like an International Grand Master playing a bright ten year old. The Americans lobbied for, and the Europeans aquiesed to, after horse-trading, this carbon trading confection at Kyoto.
The Russians come along, take a look at the board, see the endgame, make the move and get back to deciding where to have lunch.
Odds are that they'll politely thank you for the game as they get up to go to the restaurant. Maybe offer to play again, should you desire to do so....