In his regular column, the BBC's environment analyst, Roger Harrabin, considers the claim that carbon trading is failing to curb emissions and could actually harm the economy.
COULD CARBON TRADING SPARK A CRISIS?
Campaigners say atmospheric carbon must not pass 350 parts per million
Carbon trading could trigger a financial collapse like the sub-prime loans crisis, according to a new report from the green group Friends of the Earth (FoE).
It's the latest in a series of assaults against carbon trading as the Copenhagen climate conference looms.
The carbon trade allows industries in developed countries to offset their emissions targets by paying for clean projects in developing countries. London's a major centre for the trade, which could reach trillions of dollars in the next few decades.
But today, FoE says its research shows that most trades are done not by polluting industries, but by traders packaging carbon credits into complex financial products similar to those which triggered the sub-prime mortgage crash.
They warn that this could lead to a future crisis of sub-prime carbon.
The report's author, Sarah Jayne-Clifton says: "Carbon trading is failing dismally at reducing emissions, yet allows speculators to grow rich from the climate crisis and hands politicians and industry a get-out clause for polluting business as usual."
I wrote recently in this column about the American Breakthrough Institute studies of carbon trading which concluded that a straight carbon tax (if ever it could be politically achieved) would be much more effective.
The UK government agrees that wealthy nations must make big emissions cuts - but insists that emissions trading still has a cost-effective part to play. Indeed, the EU's promise of 30% emissions cuts if other nations agree tough targets is based on carbon trading.
Now the EU is flying the flag for trading, and assuming that it will provide much of the funding needed for adaptation and clean energy in developing countries.
Having just returned from China it's eminently clear that in theory it is much, much more efficient to provide clean infrastructure in a fast-emerging economy than in wealthy countries with so much of their energy infrastructure, factories and homes already set in concrete.
But it won't work if people can't trust the trade. On a previous visit to China I went to a wood-waste power station funded under the carbon trading scheme known as the CDM. It was obviously working well. But when I asked the owners if they had really needed the CDM cash to make the economics work they repeatedly refused to answer.
This touches on the principle known as additionality - i.e. will a clean development project slow emissions growth in a way that would not have happened without it? This will have to be bolted down very firmly if agreement is to be reached on it in Copenhagen.
When I ponder the cost of making my inherently leaky Victorian home in London properly energy-efficient, I can't help thinking how much better it would be to spend that money insulating some of the Chinese buildings that are being hurled skywards as a breathtaking rate.
But could you trust that the investment would happen in the right way? Friends of the Earth are by no means alone in their scepticism.