Carbon Trade Exchange launches

Monday, 14 June 2010

The next generation of carbon trading allows companies of all sizes to become carbon neutral in a fast, transparent and efficient online exchange.

Predicted by many to be the world’s largest commodity in 2020, Carbon is on everyone’s lips. After much anticipation Carbon Trade Exchange (CTX) has launched as the world's first global spot electronic exchange for the most recognised Voluntary Carbon Credits, and it is set to revolutionise the Carbon market.

Voluntary Emission Reductions (or VERs) are a range of legitimate emission offsets with robust environmental credibility, which are purchased by companies not regulated under the EU ETS as an effective mechanism to become carbon neutral. VERs are not regulated under the UN Clean Development Mechanism (CDM), but verified by reputable independent third party standards, such as Voluntary Carbon Standard and Gold Standard. Companies of all sizes want to reduce and offset their greenhouse gas (GHG) emissions, but there has previously been a veil over the process, price and origination of VER credits.

Until now, emissions trading has been predominately conducted by large global organisations, energy companies and major banks either under mandatory CDM criteria or within schemes such as the EU ETS impacting a broader cross section of the business community in Europe and some regions in other countries. Until now, the trading of the majority of VERs, an industry already worth hundreds of millions annually, has been conducted via over the counter (OTC) trades which are expensive, cumbersome and incapable of handling the vast number of trades which SMEs and large enterprises now need and demand. CTX is the first global trading platform which is designed for this purpose.

“It is time for business leaders to do just that - take the lead on combating climate change. A small percentage of any companies revenues and profits is all it takes to measure, reduce, then offset your emissions, to take charge of corporate social responsibility. We only have one planet- how can we expect to profit from our efforts and not help fight a challenge that threatens our very existence?” argues CTX’s CEO Wayne Sharpe.

In voluntary carbon markets, activities that reduce GHG’s produce verified emission reductions that can be sold to companies or individuals wishing to voluntarily reduce their carbon footprint.

VERs can be generated from projects which:

- are either based in a country that has not ratified the Kyoto Protocol (e.g. USA) or does not have the infrastructure to support CDM project development;

- have not yet been registered under the CDM;

- fall outside the scope of the CDM;

- are too small to warrant the costs of CDM approval;

- are specifically developed for the voluntary market.

CTX has been designed from the bottom up, making emissions trading fast, efficient, transparent and affordable for businesses of all sizes – from huge multi-nationals to the small businesses which form part of their supply chain. This enables companies to legitimately remove themselves from the calculation of the world’s, or their client’s carbon footprint; a critical issue with over 60 countries legislating for companies to measure, monitor reduce and offset their GHG emissions.

A recent UK Government report (Lazarowicz: July 2009) stated that “a global carbon trading network will be vital to prevent dangerous climate change”. In fact, a global exchange for VERs is the only way that carbon trading can really work, because it allows multiple types of credits and standards, and a huge variety of project types from all over the world to be found in one convenient web based platform. Regional schemes may promote local trade and direct reduction of emissions, but the supply and demand of emissions and offsets is imbalanced globally, so only the primary Voluntary credits are capable of being produced and sold locally and/or globally.

CTX’s unique electronic interface with the Markit Environmental Registry allows instantaneous transfer of ownership of primary Voluntary credits with no possibility of double selling. Buyers now have the ability to search by product, standard, project type, continent and location; then sort their search by price or best match to their requirements. A purchase can be completed in seconds - a process that can take weeks or months OTC.

The ‘mystery’ of price or quality of VERs is taken away. The CTX trading platform lists both buyer and seller prices, allowing buyers to bid for a particular type of VER if it is not on the exchange or for a preferred price. Furthermore, the unique ‘info button’ on the CTX trading screen links directly to the original documentation of the VER credit origination, enabling fast, effective and informative research on how and where credits were produced and verified.

CTX's infrastructure includes direct connectivity to the Markit Environmental Registry and Markit Eco, Markit's web-based environmental platform for corporate GHG management programs. The partnership provides Markit clients with access to trading and exchange services from CTX and allows CTX clients to open accounts on the Markit Environmental Registry in order to facilitate tracking of credits and management of ownership.

For projects and credit originators, the days of dumping credits for little or no return are gone. By joining the exchange they can maximise their return on investment and monetise their carbon assets quickly and cost effectively.

An alliance with Carbonflow, a ‘cradle to the grave’ project management technology solution, enables carbon originators (sellers) to enter the CTX platform directly from Carbonflow’s Connect+, allowing users to follow the status of the traded credits in real time. Straight-through processing of project information from developer, over auditor into the registry and up to the traded credit with unbroken digital audit trail, will instill full trust in the voluntary credits market.

For Brokers, finally the answer to their prayers - a web based user friendly trading screen, and a continuous trading contract with easy access for them and their clients. Customer service with a high tech edge allows brokers to focus on their skill and knowledge, not paperwork and phone calls.

The award-winning software development from Tradeslot and Bartercard; the world’s largest non-cash trade exchange, means that CTX’s international software development is unrivalled in the industry. Bank clearance solutions provided by major international banks also demonstrate that Carbon Trade Exchange is an innovative new product from an international team of experts and its partners, who are turning their attention and resources to the world’s most pressing problem; global climate change.