Carbon market implementations in the world and Turkey-BIST adaptation

Environmental pollution, carbon emission and global warming spiral is one of the most significant problems of nowadays and is becoming growing problem day by day. Within the framework of awareness that has begun to emerge in various fields, certain solution proposals come to the forefront. The basis of these solution proposals make ground creating social awareness, setting a price for carbon emission, and developing technologies to prevent heating. The effective issue in the market mechanism is to determine a price for carbon through incentives or deterrence. The prices can be set inspiritingly or aversively by setting a restrictive limit on the amount of emissions allowed (emissions trading system – cap and trade) or by taxing carbon released into the atmosphere. The main purpose of this study is to examine the market theory from an economic point of view with respect to the prevention of global warming. In this regard, a framework of carbon markets has been formed, The European Union Emission Trading System, which is the leading example in the world, has been analyzed. Then, the two main stock exchanges linked to this system European Energy Exchange AG and Intercontinental Exchange Inc. have been addressed in terms of financial products that are traded, market forces and clearing centers. In the last section, how the carbon market to be established at Borsa Istanbul in our country will be adapted over the existing markets has been discussed and the sectors that can be compassed in the regulation have been determined. During the preparation of the thesis, literature and legislation have been reviewed and the existing examples have expressed with historical processes. Borsa Istanbul market regulations and transaction procedures have been benefited to adapt the carbon market. In conclusion, it has been concluded that carbon market implementations are a measure tool that can be formed in terms of financial markets against the global warming problem. In addition, the importance of adapting the existing examples to the market in Borsa Istanbul in the context of deepening and developing capital markets has been emphasized and the advantages that our country will gain with integration into the economic globalization process have been shed light on. Key words: Carbon Markets, Emission Trading System, Borsa Istanbul, Capital Market Instrument, Global Integration