A report by the Intergovernmental Panel of Climate Change summarises facts and consequences of climate change. Economic damage from extreme weather events has increased by the factor 15 over the past three decades. A major factor of the damage increase, as measured by insurance companies, results from a growing wealth and an increasing value of assets. Global greenhousegas emissions have risen sharply compared to the pre-industrial era. Countries around the world have agreed that such emissions must be reduced. The instrument of emissions trading works best when more countries and economic sectors are involved, and when auctioning of emission allowances is possible. There is no question that climate change harms the economy. Therefore international climate agreements need to cover long term goals for emission reduction as well as efficient instruments such as an international emissions trading system.