Title page 1

Contents 1

Executive summary 1

1. Introduction 2

2. Fundamental choices 5

2.1. Who sells credits? Project developers vs governments 5

2.2. Who buys credits? Governments vs private companies 6

2.3. Offset ratio: One-for-one vs leverage 6

3. Putting the framework into practice 8

3.1. Mitigation value 8

3.2. Carbon Credits Clearing House 8

3.3. Carbon Buyers' Club 9

4. Conceptual challenges 11

5. Conclusion and outlook 13

References 15

Table 1. Fundamental choices in international carbon market design 7

Figure 1. International carbon trading as a pillar of EU international climate policy 3

Figure 2. Using foreign units as collateral, the CCCH lends domestic compliance units 10

Figure 3. After stocktake evaluation in 2040, private buyers settle their accounts 11