ESTABLISHED SCHEMES
Kyoto Protocol, launched: 2005
Mandatory for 37 developed nations, excluding the United States which never ratified the pact.
Covers: all six main greenhouse gases
Target: 5 per cent reduction in 1990 emissions by 2008-2012
How it works: Rich countries cut greenhouse gases at home or buy emissions rights from each other - if one country stays within its target it can sell the difference to another emitting too much. Alternatively, they can buy carbon offsets from projects in developing countries under Kyoto's clean development mechanism. The present round of Kyoto expires in 2012 and the world has committed to sign a new pact in December.
European Union Emissions Trading Scheme, launched: 2005.
Mandatory for all 27 EU member states.
Covers: Nearly half of all EU carbon emissions.
Target: 21 per cent cut below 2005 levels by 2020
How it works: Member states allocate a quota of carbon emissions allowances to 11,000 industrial installations. Companies get most permits free now but many electricity generators will have to pay for all these from 2013. Companies can buy carbon offsets from developing countries if that works out cheaper than cutting their own emissions.
Northeastern U.S. states' Regional Greenhouse Gas Initiative (RGGI) cap and trade scheme, launched: January, 2009.
Covers: carbon from power plants in 10 north-east states
Target: 10 per cent cut below 2009 levels by 2018
Japan's voluntary carbon market, launched: October, 2008.
Covers: carbon emissions from energy production, 2008-2012.
How it works: Companies exceeding their voluntary targets can buy carbon allowances from others which stay under theirs, or from small companies to help them fund efficiency gains, or buy carbon offsets.
PROPOSED SCHEMES
Australian Carbon Pollution Reduction Scheme, Launch: mid-2011.
Covers: 75 per cent of all Australia's greenhouse gas emissions.
Target: Australia's national target is to cut greenhouse gases by 5-25 per cent below 2000 levels by 2020, depending on what other countries commit to.
How it will work: Australia will auction most of its permits. The scheme plans to curb competitiveness impacts by making permits free for companies that depend on exports.
U.S. federal climate change bill, proposed launch: 2012.
The U.S. Senate is mulling approval of a climate bill which the Democrat-controlled U.S. House of Representatives narrowly approved in June. It faces a tougher test in the Senate.
Covers: Carbon dioxide and other greenhouse gases.
Target: Cut 17 per cent below 2005 levels by 2020.
How it would work: Industry would get most allowances for free initially. Companies could offset up to 2 billion tons of their emissions annually by paying for "green" projects. The bill would pre-empt any similar scheme from U.S. states from 2012-17 but leaves them the option to resume trade after that.
U.S. and Canadian Western Climate Initiative, launch: 2012.
Covers: six greenhouse gases across 11 U.S. and Canadian states/provinces, from power plants and transport.
Target: 15 per cent cut below 2005 levels by 2020