The Overview of Carbon Credit Market in Thailand

Abstract

The concept of Carbon Credit Trading is generated from Kyoto Protocol and is basically used to control the greenhouse gas emissions (GHGs). This concept is used to earn carbon credit earnings and trading between various companies and governments. This concept is basically known for the reduction of carbon emissions in order to mitigate future climate changes; the target is mainly greenhouse gases especially carbon dioxide. Thailand is also facing challenges in energy-environment-economy development in the context of limited energy resources availability and global climate change. Recently, Thailand has proposed policies on GHGs mitigation such as Thailand’s Nationally Appropriate Mitigation Action (NAMA), which aims at GHG mitigation in the energy sector. It is important to take stock of global scenario of the carbon credit business. Thailand signed and ratified the Kyoto Protocol in 2002. Since then, Thailand is exempted from the framework of the treaty; it is expected to gain from the protocol in terms of foreign investment. In this market, Thailand is an early entrant. Initially, the concept was only exploited and en-cashed by some big business players. But, now, some new and smaller companies are paying more attention and also utilizing the opportunities. This market is now the fastest growing financial market in Thailand. This article mainly focuses on the situation of carbon dioxide emissions both in global trend and in Thailand. It also explains the carbon credit trading market mechanism, accounting treatment of carbon trading situations of Thai projects. Results show that the international free emission trading policy can drive more GHGs reduction by decreasing energy supply and demand, and increasing costs of emissions.