An Obama victory has brought a global carbon market a step closer, and despite the recent financial turmoil investors are still funding technology innovations for carbon markets, too. This morning @Ventures says it has invested in carbon market software startup CarbonFlow, joining previous investors Clean Pacific Ventures, OVP Venture Partners and Meridian Energy. We heard from a source close to the company that @Ventures’ investment was around $1 million.
The two-year-old company develops software to bring transparency and efficiency to the carbon markets and was founded by Jane Capital partner (and cleantech blogger) Neal Dikeman and Australian green building pioneer Karla Bell. The software enables carbon market participants to collaborate on projects, keeps a record of the work completed, and helps with validating carbon-reducing projects.
Technologies like this are sorely needed in the current carbon markets, which have been hampered by inefficiencies, a lack of transparency and are still sort of a Wild West stage at this point. Critics question whether carbon offsets projects are actually facilitating new carbon abatement, and the World Wildlife Fund released a report last year calling 20 percent of the UN’s certified emissions reduction credits, as facilitated through the controversial clean development mechanism process, bogus.
Despite the hurdles, the nascent carbon market is already growing. Carbon markets like the Chicago Climate Exchange (CCX), and its London-based sister, the European Climate Exchange, led the market to triple in size to $30 billion in 2006, according to the World Bank. The entire market could triple by 2015.
The next step is implementing technologies like CarbonFlow and using the tools of the Internet, IT and computing worlds to bring transparency and efficiency to the market. The future of a global, trustworthy carbon market depends on it.
CarbonFlow sees the potential — the company says its software is designed to meet Kyoto standards including registration, verification, certification and monitoring, and the startup has also partnered with Norwegian firm DNV, which was one of the first companies to be accredited by the UN to verify greenhouse gas reductions from projects in the developing world.