Arctic Yearbook 2015 - Page 424

424 Arctic Yearbook 2015 25 20 15 10 5 0 RUS USA DNK ISL 2005 FIN NOR SWE WLD 2011 Several of the Arctic Council members are exporters of oil and gas. And their CO2 emissions on a per capita basis are above the world average. However, most of the countries (except Russia) in the Arctic are experiencing a decrease in the CO2 emissions on a per capita basis, since 2005 (Figure 2). This is largely due to ambitious emission reduction targets1 and successful renewable policies in the Nordic countries. In the case of the United States, shale gas has contributed to mitigation progress in the industrial sector. The Nordic countries have pioneered energy and carbon taxes, which provide incentives for energysaving and fuel switching to lower carbon energy. Figure 3 illustrates renewable energy share in total energy supply and net removals of CO2 from LULUCF2 in Nordic countries. Iceland has a high proportion of renewables in their total en ergy supply. And carbon sequestration such as LULUCF has resulted in a decrease of net carbon emissions, by 25% lower than in 1990. Figure 4: Renewable Energy as % of Total Energy Supply (2012) and Net Removals (MT CO2) from LULUCF, (2011). 100 10 80 0 60 -10 40 -20 20 -30 0 -40 Denmark Finland Greenland LULUCF (RIGHT) Iceland Norway Sweden RENEWABLE (LEFT) Climate change is not a regional issue, but rather part of a global agenda. Without support from developing countries, the synergy effects of national policies in leading countries will be limited. In this regard, carbon financing can be a catalyst to promote investments towards a low-carbon economy. The European Union Emissions Trading Scheme (EU-ETS) has served climate policy using market instruments, providing price signals for abatement technology since 2005. It allows firms to choose abatement technologies based on market price of CO2 permits, so that market price reflects information regarding demand and supply for the carbon permits. As such, market efficiency is a key The New Nexus of Climate & Energy Security