What's with all the carbon talk?

I have been reading a few articles and reports about the concept of Clean Development Mechanism - the use of financial instruments to reduce carbon emissions. A brilliant story, quoted to forewarn the stakeholders about the vested interests of the Wall Street is as follows:

For aficionados of offbeat road races, there are few events that top the Tour de Donut, a 30-mile bicycle race held every July in tiny Staunton, Illinois. In this belly-busting race, competitors stop twice during the course at break stations where they are offered glazed donuts. For every donut that competitors consume, five minutes are deducted from their scores. Thus, for even mediocre riders who also are really good donut eaters, the ride offers an offset structure that makes them champions. In recent years, with top competitors downing over 20 donuts each, winners have actually posted negative times, finishing their races—on the books at least– before they began.

The full article can be accessed here. The article goes on to mention why the CDM will be a failure and how the US government is playing into the hands of the rich and powerful at the Wall Street. According to them, Wall Street is trying to create a huge financial market which trades carbon-reductions as a commodity. Since the volumes will be low, the market will not actually possess all the reductions being traded - it will be hedged and re-packaged in futures and swaps. This could well be the foundation for another financial meltdown!

Reading the article and learning about the possibility of carbon-based futures/contracts and swaps reminds me of Enron - how the company used to hedge natural gas and oil and make money and finally ceased to exist. The carbon finance space seems exciting and should throw up a lot of controversies over the next decade.