The volume of carbon permits and credits traded in North America is set to double in 2012, with as many as 179 million tonnes expected to change hands as California and Quebec’s carbon markets come to life, a new report by Thomson Reuters Point Carbon finds.

 

The two regions are founding members of the Western Climate Initiative (WCI) emissions trading system. They will distribute the first batch of allowances to emitters – roughly 24 million tonnes – in 2012, an event that is expected to spark trading in the primary market.

The report says that WCI will likely overtake RGGI, the northeast US’s carbon trading scheme for the electric sector, as the most traded carbon market in North America this year with an expected value of $782 million.

“We foresee the primary market dominating WCI transactions in 2012, with a total market size of 28 million tonnes and a value of $392 million, up nearly tenfold from 2011 and overtaking RGGI as the biggest North American carbon market in value terms,” said Ashley Lawson, a carbon market analyst for the firm is quoted as saying in a PointCarbon article.

California’s and Quebec’s cap-and-trade programs are set to begin in 2013, covering greenhouse emissions from power plants and large industrial sources.  It will then expand to cover emissions from transportation fuels from 2015.