Carbon partnership hopes to go global

By Henrique Almeida

LISBON (Reuters) - A coalition of European countries, U.S. states, Canadian provinces and New Zealand signed a partnership on Monday to slow global warming through an international carbon trading market, officials said on Monday.

The International Carbon Action Partnership (ICAP) hopes to become a stepping stone for the creation of a global market for heat-trapping gases that many scientists link to extreme weather like violent hurricanes and rising sea levels.

"We will be sending important signal to others. We will be saying to leaders across the world that we can work together to reduce emissions," said European Commission President Jose Manuel Barroso.

The European Union has taken the lead in the fight against global warming by setting up a landmark EU emissions trading scheme in 2005 which aims to reduce emissions by putting a price on carbon that businesses use.

Carbon markets allow countries and companies to meet greenhouse gas emissions targets by shopping around for the cheapest carbon offsets, but some analysts say that wide differences among proposed schemes will prevent market links.

"I firmly believe a global market for greenhouse gases will allow us to protect the environment while growing the economy," said Arnold Schwarzenegger, the Governor of California and one of ICAP's 20 founding members, in a video message.

"This partnership will provide more incentives for clean-tech investment and economic growth while not letting polluters off the hook."

At least 16 U.S. states plus New Zealand, Australia and seven Canadian provinces are investigating following a European Union's lead by launching a carbon trading scheme, as one policy tool in the fight against climate change.