  Existing emissions trading system (ETS) designs inhibit emissions but do not
constrain warming to any fxed level, preventing certainty of the global path of
warming. Instead, they have the indirect objective of reducing emissions. They
provide poor future price information. And they have high transaction costs for
implementation, requiring treaties and laws. To address these shortcomings,
this paper proposes a novel double-sided auction mechanism of emissions permits
and sequestration contracts tied to temperature. This mechanism constrains
warming for many (e.g., 150) years into the future and every auction would
provide price information for this time range. In addition, this paper proposes
a set of market rules and a bottom-up implementation path. A coalition of
businesses begin implementation with jurisdictions joining as they are ready.
The combination of the selected market rules and the proposed implementation
path appear to incentivize participation. This design appears to be closer to
"first best" with a lower cost of mitigation than any in the literature, while
increasing the certainty of avoiding catastrophic warming. This design should
also have a faster pathway to implementation. A numerical simulation shows
surprising results, e.g., that static prices are wrong, prices should evolve
over time in a way that contradicts other recent proposals, and "global warming
potential" as used in existing ETSs are generally erroneous.
