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Yael Parag,1 Tina Fawcett2 1School of Sustainability, The Interdisciplinary Center, Herzliya, Israel; 2Environmental Change Institute, Oxford University Centre for the Environment, Oxford, UK Abstract: Personal carbon trading (PCT) is a radical and innovative mitigation approach for the residential and personal transport sectors. PCT is an umbrella term for various downstream cap-and-trade policies, all of which aim to limit carbon emissions within a society by engaging individuals in the process, and could cover more than 40% of national carbon emissions. This policy idea is unique because it provides an overarching approach to personal emissions from energy use and because it combines a number of mechanisms to drive behavior change: economic, psychological, and social. This paper presents a review of research evidence and real-world experience of PCT. Most of the political interest, research, and experimentation with PCT has taken place in the UK. During 2006–2008, the UK government commissioned a number of studies on PCT, following high-level political interest. It concluded that public acceptability and the cost of the scheme were serious barriers to its introduction. However, a variety of other research work has subsequently demonstrated that public acceptability may not be such a barrier as feared. Nevertheless, there are a number of other barriers, including costs and technical challenges, some adverse distributional effects, and the low carbon capabilities of citizens. Probably the main barrier is the lack of political will currently to consider PCT as a real option. However, opportunities for PCT adoption could open up, particularly if governments fail to meet their carbon reduction targets. PCT is still an idea rather than an implementable policy – more research is needed to develop detailed scheme designs, which can be tested with regards to equity, effectiveness, cost, and efficiency. Other research requirements include understanding public conceptions of fairness in relation to climate change mitigation. Some interesting experimental research on PCT is currently taking place in Norfolk Island, Australia, but many research gaps remain. Keywords: emission reduction policy, residential energy