Ryan Dezember, Wall Street Journal, covers the CME’s plan to launch (on March 1st?) a carbon credit futures contract, here…
”Prices will be derived from transactions on a voluntary-offset exchange operated by Xpansiv CBL Holding Group Ltd., a firm that makes markets in data-based assets linked to energy, agriculture and ESG investing. The credits sold must have been verified by one of three carbon registries, organizations that uphold project standards and certify offsets.
Offset buyers on Xpansiv’s platform currently browse credits by price and project, said Andy Bose, the firm’s head of ecosystems and partnerships. Xpansiv, which won’t disclose prices until the monthly futures contracts begin trading on March 1, created a spot contract in conjunction with them. Both are intended to satisfy bulk buyers who care more about price per ton than provenance, Mr. Bose said.
Each futures contract represents 1,000 offset credits. They will be settled physically, which means the holder of an expiring contract will receive certificates for 1,000 metric tons of carbon that have been eliminated or stashed away.
There were $320 million of voluntary-offset transactions in 2019 and a similar volume in 2020, according to Ecosystem Marketplace, a nonprofit that tracks carbon markets.
Transaction and trading volume is expected to surge as deadlines approach for companies to meet emissions targets.”
And here is a look at the Carbon emissions futures contract traded on ICE from Barchart.com:
Leave a Reply