Carbon trading
Several WFE members are active in servicing national and international carbon trading markets:
- The Montréal Exchange, part of the TMX Group, created the Montréal Climate Exchange (MCeX) in 2006 as a joint venture with the Chicago Climate Exchange. MCeX officially launched trading in May 2008, two months after the Government of Canada published the final version of its Regulatory Framework for Industrial Greenhouse Gas Emissions. MCeX provides a trading platform for futures contracts based on carbon emission reduction credits, enabling companies that have a ‘carbon cap’ to manage their emissions risk at lowest cost.
- The Australian Securities Exchange (ASX) is at an advanced stage of readiness to introduce futures and options products based on greenhouse gas emission permits and emission reduction credits, pending the introduction of planned legislation to implement the Australian government’s Carbon Pollution Reduction Scheme.
- NYSE Euronext has a 60 per stake in Paris-based BlueNext, whose stated aim is to be the world’s largest exchange for carbon and other environment-related products. BlueNext’s current products include both spot and futures markets for Certified Emission Reduction (CER) credits under the Kyoto Protocol’s Clean Development Mechanism and European Union Allowances (EUAs) under the European Emissions Trading Scheme (ETS).
- NASDAQ OMX Commodities and Nord Pool ASA together constitute Europe’s leading commodity exchange for power and global emission products, including spot and physical forward contracts for both EUAs and CERs. NASDAQ OMX Commodities also operates the clearing business and offers consulting services to commodity markets globally. More than 50 per cent of the energy consumption in the Nordic countries is based on renewable energy resources.
- Deutsche Börse and SIX Swiss Exchange jointly operate Eurex, one of the world’s leading derivative exchanges. In partnership with the European Energy Exchange (EEX), Eurex offers trading and OTC clearing in EUA futures, CER futures and options on EUA futures. In 2009, Eurex expanded its product range with the addition of weather derivatives. Eurex is also the parent company of the International Securities Exchange (ISE), which offers three cleantech indices with their associated ETFs and index options products.
- In Brazil, BM&FBOVESPA has created a Carbon Market comprising a Carbon Facility (which hosts the registration of carbon emission reduction projects validated under the Clean Development Mechanism (CDM) and a Carbon Credit Auction System. The Exchange is currently examining the feasibility of organising an OTC market for CERs.
- The Buenos Aires Stock Exchange (BBA) has launched a Carbon Market to promote the development of CDM projects in Argentina. This includes education programs, corporate carbon trading simulations and building relationships between project developers and international investors.
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