Abstract :
The man-made emissions of carbon dioxide (CO2) are believed to be responsible for the small amount of global warming. The fear is that these emissions might accelerate global warming into something much worse. Carbon trading is putting a price on carbon and creating a cost to its emission thus creating an incentive not to do so. If a limit is set on carbon emissions and issue carbon permits to trade, i.e. the right to emit carbon, then it creates commercial flexibility for companies that they can either reduce carbon and fulfil their quota or, if they can´t afford that, buy permits from those firms that have reduced more than their required amount. The greatest problem of carbon dioxide is that it does not consider energy security.
