Announcement

News from our Partners: Chicago Exchange Lists CCAR Offset Credits

February 23, 2009 - The Chicago Climate Futures Exchange (CCFE) will now offer futures contracts on Climate Reserve Tons (CRTs), the emissions reductions credits issued by the Climate Action Reserve, the offset program of the California Climate Action Registry (CCAR).

C-Quest Capital said it conducted the first trade in CRTs on the exchange with Tradelink. The US carbon trading company said it sold 10,000 CRTs for December 2009 delivery at $6.25. 

"CCFE provides market participants with a low cost, transparent and standardised platform to hedge against price fluctuations in the CCAR emissions offset market on a CFTC regulated exchange," CCFE said in a brochure announcing the new contract.

Justin Felt, senior analyst at Point Carbon, said the listing of CRTs on the CCFE will provide much needed transparency in the pre-compliance offset market. "This will foster liquidity and price-formation, as well as provide hedging vehicles for companies or organisations exposed to the wide price swings of the voluntary market," said Felt. Prices for offsets certified under the Climate Action Reserve have been seen in the previous month in a range between $5.90 to $8.70, according to Point Carbon data. Up until January, they had been trading up to around $11.

The CCFE, a futures exchange focused on environmental products, lists a variety of voluntary and mandatory emissions credits, including carbon financial instruments (CFIs), Regional Greenhouse Gas Initiative allowances (RGAs) and certified emissions reductions (CERs).

The new product is now awaiting certification by the Commodity Futures Trading Commission.