If the application is approved, the Green Exchange, which is
owned by the Chicago Mercantile Exchange group, will be able to
operate as a stand-alone entity and list futures and options
based on environmental products.
At the moment, CME Group’s environmental contracts
are listed on the New York Mercantile Exchange.
Tom Lewis, the chief executive of the Green Exchange, said
in a statement that: "Once a DCM, the futures and options
contracts currently traded on Nymex will be seamlessly migrated
to Green Exchange enabling customers to continue to benefit
from the same screen-trading access through CME Globex as well
as the safeguards of the CME Clearinghouse."
The products that will be offered, should the exchange gain
approval, will be based on both European and North American
carbon markets. It will offer derivatives based on EU
Allowances and Carbon Emission Reduction certificates, which
are used for compliance under the EU’s Emissions
Trading Scheme. It will also offer a suite of derivatives based
on North American products such as NOx, SO2, Regional
Greenhouse Gas Initiative certificates and Climate Action
Lewis announced the move this morning at the US
Environmental Market Association’s Environmental
Markets Summit in New Orleans.
The exchange will compete with the Chicago Climate Exchange,
the parent company of the Chicago Climate Futures Exchange and
the European Climate Exchange, which list similar products. In
March, volume reached 55,400 at the CCFE and trading at the
European Climate Exchange reached an average daily volume of
20,700 in March, down 16% year on year.
Gary Hart, a senior energy analyst at Icap in Birmingham,
Alabama, said that he believed that the two exchanges "could
coexist and be mutually beneficial".
Andrew Ager, head of emissions trading at Bache Commodities
in London, said that: "There is room for another exchange" in
this market and that the European Climate Exchange "really
needs a competitor".
Sian Williams +44 207 779 8370 firstname.lastname@example.org