The linkage, which marks the first agreement in North America that allows for the trading of greenhouse gas emissions across borders, is designed to escalate the price on the amount of carbon businesses can emit.

There is a “potential for this market to serve as an example for other North American subnational jurisdictions to follow if it can prove to be successful,” said Robin Fraser, a Toronto-based analyst with the International Emissions Trading Association.

Meanwhile, the European Union (EU) opted to beef up its carbon trading system. Carbon prices are poised to rebound from a three-year decline after the 28-country bloc decided to back a stopgap plan to reduce the number of pollution permits that have flooded the market. As a result, the cost of emitting carbon dioxide may increase more than 50 percent on average to $10.54 a metric ton by the end of 2014.

The “backloading” plan aims to remove 900 million permits from the EU market between now and 2016. The date on which the law is formally adopted will drive the quantity of permits that can be withdrawn from auctions this year.

“If the auction calendars can still be adapted by end-March, a total of 400 million allowances will be backloaded for 2014. This amount will be reduced to 300 million if backloading is initiated in April, May or June,” according to the European Commission.

The move, The Economic Times reports, may help to lead global carbon market recovery in 2014. Last year, global carbon markets’ value dropped 38 percent to $52.9 billion.

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Source: National Geographic, 9th January 2014 by Tim Profeta