I am thankful I read this book. As my first book on carbon markets, it laid out the subtle principles of cap-and-trade in clear articulate language. I got it. And it was actually quite fun to read. What was lacking from this book were concrete examples of carbon trading in real time. If I could have my wish, the authors would produce a second edition which has a section called 'Carbon Trading in Real Time' (a snap shot of a month in the European Trading Scheme). In short, the book is perfect on getting the big concepts across but falls short when it comes to making the reader understand how the market really works each day.

This book expertly addresses numerous topics with the right amount of detail. While carbon markets have multiple moving parts--often moving too quickly for anyone person or team to keep up with--this book provides the necessary frameworks to understand how policies will likely evolve and what ramifications they will have on business. Having spent the better part of 2 years researching carbon markets and corporate responses this book has become my favorite resource.

To anyone looking for a sound understanding of the history, current status, challenges and possible future(s) of carbon markets and their importance for emission reductions, I warmly recommend this book. Whether you're interested in joining this field (my case) or simply wish to be an objectively educated citizen on this essential subject (my case too in fact), this book won't disappoint. The three facets I have appreciated the most are: 1) the book manages to both provide a lot of detail (should you need it) and make the subject look simple and easy to understand, even if your prior knowledge is minimal (as was mine). It does that by explaining the basics where necessary, so you don't get hung up on a concept that eludes you (for instance, there is a box on why discounting future cash flows matters - if you're a finance whiz, skip it, otherwise read it). It also presents all sides of an argument and breaks it down in manageable bits, often of not more than one page. The authors are careful in explaining context first, then dive into detail but one concept at a time, so you never get drowned in too many new things at once. For example, the chapter on the Kyoto Protocol starts with a little intro, then 5 pages on the political context (broken down in 5 subsets of about a page each (for example the Clean Air Act in the US), then a dozen pages on the characteristics of emission markets (again broken down in manageable roughly-one page bits such as "the European bubble" or "reforestation / deforestation), etc. Each chapter ends with a one page conclusion / summary, and copious notes and references. 2) the book is totally global in scope: US, Europe, Australia, Emerging markets - each side gets covered with the same level of attention (though you don't have to read every chapter if you don't need to). 3) what I've probably liked most of all is that the authors leave politics and ideology completely on the side. In today's political debate, you have good people defending carbon taxes with passion, and other good people falling on their sword for cap and trade, with each side depicting the other as fundamentally wrong. Well, the authors simply provide us with the theory behind both approaches, the pros and cons of each, and how each would be more or less adapted to a given situation and goal. It was hugely refreshing to see both sides presented objectively, so i could make up my mind for myself. Likewise, the authors do a good job of presenting the contrasting stakes of developed and less developed countries, again without taking sides. Finally, the book presents a good number of data, in graph or table format, including well into 2009. In a field that is evolving so fast, this book feels fresh and just out of the oven.

In short, I found this a must read to get a solid understanding of this most pressing debate.