It appears that the carbon offset market is dying in the USA. You may recall the WUWT story from 9/9/09 on the Chicago Climate Exchange trading price dropping to 25 cents per metric ton. See
Market Confidence Low: Carbon Credits now worth 25 cents, were at $7 in 2008
Since then, the price has dropped to 20 cents per metric ton for all Carbon Financial Instruments (CFI) except for the 2010 issues, losing 20% of their value. Trading volume has also dropped to a trickle with only 200 transactions Friday. Here’s the closing data from Friday, 9/18:
Last Friday, 9/11/09 appears to be the day when the current drop started.
It appears there was a big selloff on 9/11, when investors got wind of a major suspension by the UN before it hit the press. On Sept 11th, there were 292,500 transactions (largest in over a month) and the price fell from the previous day closing price of 25 cents:
click for larger imageThe Sunday Times has the story:
The legitimacy of the $100 billion (£60 billion) carbon-trading market has been called into question after the world’s largest auditor of clean-energy projects was suspended by United Nations inspectors.
No wonder carbon offsets are falling to 20 cents a ton. Coal is still much more valuable at 40-50 dollars a ton.
A look at the CCX external advisory board roster is telling. Here’s a partial list below.
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CCX’s Advisory Board was formed to provide the Exchange and its Members with external strategic input from some of the world’s top experts from the environmental, business, academic and policy-making communities.
Honorary Chairman: The Honorable Richard M. Daley, Mayor, City of Chicago
Ed Begley Jr. has been considered an environmental leader in the Hollywood community for many years. He has served as chairman of the Environmental Media Association and the Santa Monica Mountains Conservancy. He still serves on those boards, as well as the Thoreau Institute, the Earth Communications Office, Tree People and Friends of the Earth. Mr. Begley’s work in the environmental community has earned him a number of awards from some of the most prestigious environmental groups in the nation, including the California League of Conservation Voters, the Natural Resources Defense Council, The Coalition for Clean Air, Heal the Bay and the Santa Monica Baykeeper. He currently lives near Los Angeles in a self-sufficient home powered by solar energy.
Ernst Brugger is Founding Partner and Chairman of Brugger Hanser & Partner Ltd. in Switzerland, a business consulting firm with international experience and range. He is also a professor at the University of Zurich, chairman and member of the board of various companies and a member of the International Committee of the Red Cross (ICRC). Dr. Brugger serves as Chairman of the Board of Directors of Sustainable Performance Group, an investment and risk management company which invests in pioneering and leading companies which have taken up the cause of sustainable business.
Lucien Bronicki is the chairman of Ormat International, an Israeli company in the field of innovative technology solutions to geothermal power plants, power generation from industrial waste heat, and solar energy projects. Chairman of Ormat since he founded the company in 1965, Bronicki chairs the World Energy Council’s Israeli National Committee, is a member of the Executive Committee of the Weizmann Institute of Science, and member of the board of Ben Gurion University.
Elizabeth Dowdeswell is internationally recognized for her global and highly diverse experience in building consensus and managing change. She advises both public and private sectors on environmental issues worldwide. Ms. Dowdeswell is a former Executive Director of the United Nations Environment Programme (UNEP). Before joining UNEP, Ms. Dowdeswell was the Assistant Deputy Minister of Environment Canada. In that capacity she played a leading role in global efforts to negotiate the treaty on climate change adopted at the 1992 United Nations Conference on Environment and Development. She was Canada’s permanent representative to the World Meteorological Organization, principal delegate to the Intergovernmental Panel on Climate Change, and Canadian Chair of the Great Lakes Water Quality Board. She is currently President & CEO of NWMO and a Visiting Professor at the University of Toronto. She also serves on the governing and advisory boards of several institutions. Ms. Dowdeswell is the author of numerous publications in both the popular press and professional journals.
Jeffrey E. Garten is former dean of the Yale School of Management. Formerly undersecretary of commerce for international trade in the first Clinton Administration, he also held senior economic posts in the Ford and Carter administrations. From 1979 – 1992, he was a managing director first at Lehman Brothers, where he oversaw the firm’s Asian investment banking activities from Tokyo, and then at the Blackstone Group. Currently a monthly columnist for Business Week, his latest book is “The Mind of the CEO”(2001).”
Donald P. Jacobs is a former Dean of the Kellogg Graduate School of Management at Northwestern University and its Gaylord Freeman Distinguished Professor of Banking. Under his leadership, the Kellogg School has become a leader in the field of business and finance and is consistently ranked as one of the top five business schools in the United States. Dean Jacobs is a former Chairman of the Board of Amtrak (1975-1979) and currently serves on several corporate boards. His work on banking, corporate governance and international finance has been published in many scholarly journals and he holds several honorary degrees and professional awards.
Joseph P. Kennedy II is Chairman and President of Boston-based Citizens Energy Group. Before returning to Citizens Energy, Mr. Kennedy represented the 8th Congressional District of Massachusetts in the U.S. House of Representatives for 12 years. Mr. Kennedy founded the non-profit company in 1979 to provide low-cost heating oil to the poor and elderly. Under his leadership, Citizens grew to encompass seven separate companies, including the largest energy conservation firm in the U.S. Mr. Kennedy also advises and serves on the boards of several companies in the energy, telecommunications, and health care industries. Mr. Kennedy is the son of the late U.S. Sen. Robert F. Kennedy.
Israel Klabin is the president of the Brazilian Foundation for Sustainable Development, a major Brazilian non-governmental organization devoted to issues of environmental and sustainable development policy. Mr. Klabin is the former chairman of Klabin SA, one of the largest forestry companies in Latin America. He is a former mayor of Rio de Janeiro and was one of the main Brazilian organizers of the United Nations Conference on the Environment (Rio 92). He is also actively involved in several philanthropical activities.
Bill Kurtis has had a distinguished career in broadcasting for over 30 years, as a news anchor in Chicago and later of the national CBS Morning News. He started his own company, Kurtis Productions, when he returned to Chicago in the mid 1980’s and currently hosts shows on the Arts and Entertainment network. Mr. Kurtis is involved in The National Science Explorers Program, Electronic Field Trips and the Electronic Long Distance Learning Network, all aimed at teaching children about science. Mr. Kurtis and his shows have been the recipients of several awards. He serves on the board of directors of organizations devoted to natural history and the environment, including the National Park Foundation, the Nature Conservancy and the Kansas State Historical Society.
Thomas E. Lovejoy is a world-renowned tropical and conservation biologist. Dr. Lovejoy is generally credited with having brought the tropical forest problem to the fore as a public issue, and is one of the main protagonists in the science and conservation of biological diversity. In 1987, he was appointed Assistant Secretary for Environmental and External Affairs for the Smithsonian Institution and is Counselor to the Smithsonian’s Secretary for Biodiversity and Environmental Affairs. Dr. Lovejoy is also Chief Biodiversity Advisor to the President of the World Bank and the Bank’s Lead Specialist for the Environment in Latin America. From 1989 to 1992, he served on the President’s Council of Advisors in Science and Technology (PCAST), and acted as scientific adviser to the Executive Director of the United Nations Environment Programme (1994-97). He was the World Wildlife Fund’s Executive Vice President from 1985 to 1987. Dr. Lovejoy is the author of numerous articles and books.
Dr. Rajendra K. Pachauri is the Director-General of The Energy Research Institute (TERI) which does original work and provides support in energy, environment, forestry, biotechnology, and resource conservation to governments, institutions, and corporates worldwide. Dr Pachauri is currently Chairman of the Intergovernmental Panel on Climate Change (IPCCC), one of the recipients of the 2007 Nobel Peace Prize; a Director of the Indian Oil Corporation Limited (a Fortune 500 company); and a Member of the Board of Directors of the Institute for Global Environmental Strategies, Japan. He has been President (1988) and Chairman (1989*90) of the International Association for Energy Economics and is President of the Asian Energy Institute since 1992. He has been a member of numerous committees and boards, including those of the International Solar Energy Society, World Resources Institute, World Energy Council, and has acted as an Advisor to the Government of India, reporting directly to the Prime Minister. Dr Pachauri has also served as a member of the faculty of several prominent academic and research institutions and has published 22 books and several papers and articles. He was recently awarded the Padma Bhushan, one of India’s highest civilian awards.In July 2001 Dr Pachauri was appointed a member of the Economic Advisory Council to the Prime Minister of India, which is chaired by the Prime Minister.
Well certainly the markets recognize the whole thing as a charade! Hopefully the broader populous is not too far behind!
In the real stock market, if a stock falls below a certain figure we call “market cap” it gets delisted. If the C market falls, it should be given a “time out”
Honorary Chairman: The Honorable Richard M. Daley, Mayor, City of Chicago
Donald P. Jacobs
Dean Jacobs is a former Chairman of the Board of Amtrak
We are missing Algore and Rod Blagojevech.
This is a Platinum panel of Cluelessness.
It won’t matter to the sellers of the stock: They got their hands on fistfuls of $$$. The investors got cleaned out once again.
The legitimacy of the $100 billion (£60 billion) carbon-trading market has been called into question after the world’s largest auditor of clean-energy projects was suspended by United Nations inspectors.
Triple A rating, I suppose.
This is a good sign for the Pyrite market!
Rajendra Pachauri, eh? I always had the feeling he was on the take. Just like Kofi Annan and Ban Ki-Moon.
The UN is a corrupt criminal organization being run on our tax money by kleptocrats.
And the President and Congress allows it, as if there’s anything the UN can do that we can’t do better, cheaper and more efficiently on our own.
There’s a lot about this scrip that I just don’t understand. Here in the NorthEast we have a beast call RGGI, Regional Greenhouse Gas Initiative, see http://www.rggi.org/home :
In their recent auction the 2009 clearing price is $2.19, the 2012 clearing prices is $1.87. Apparently there’s a minimum price and $1.87 is close.
It may be this is a price for generating stations in the RGGI area, so perhaps the CCX units are for another region or for something significantly different. This would make a lot of sense if the electricity generated by burning enough fuel to release one ton of CO2 cost more to transport from Chicago (or whereever) into the RGGI region.
Ah, see http://www.ccfe.com/ the Chicago Climate Futures Exchange – they trade RGGI futures. “RGGI Dec09 V09 $2.48” Why isn’t that closer to $2.19? “CCFE RGGI futures and options contracts on RGGI carbon dioxide (CO2) allowances provide market participants with a low cost, transparent, and standardized platform to hedge against price fluctuations in the RGGI CO2 emissions market.” Sounds like it’s time to sell to me!
See also http://granitegeek.org/blog/2009/09/11/carbon-prices-fall-in-rggi-auction-as-electricity-usage-drops/
Thanks Smokey (10:25:46)
Short and spot on remark.
Ed Begley Jr.
Ed Begley Jr?
ED BEGLEY JR!!!!????
Uh, is this a trading exchange or a cafe on Melrose?
(Yes I’m still in Brazil) jeez aka ctm
The second major “inspector” of the validity of carbon contracts has been suspended.
Their trading volume in units is down 95% and the price per unit is near zero. it isn’t worth getting Punjab on a donkey and paying him pennies to visit a field and validate the groves for carbon contract compliance.
http://www.freecarbonoffsets.com/home.do
On the good side, Soros and other early big players sell short and make loads of money when the market falls. Soros is the financial backing for Climate Progress and Joe Romm. Talking up green jobs buy using ACORN and liberal media helped Hype the carbon scam. Van Jones tried. If we have people invest in windmills with the promise that carbon contracts will triple the price of coal generated electricity, we can get rich.
The next 5cents will be a 25% drop, than a 33% drop, and 50% after that. Finally, they will lose it all. Amen!
Ecotretas
The first tool for directly hedging exposure under a “potential” mandatory U.S. greenhouse gas trading program. (learn more) / (Download FAQ Brochure)
This is like gambling on a product with a contingency that a law will be passed/
“Charade” is a great word. Some states plan on denying carbon output and selling indulgences if you do.
I will buy a few when they hit the $ 0.10 and use them to wall paper the toilet.
Wow, that is one ugly chart. Almost Nortelian or Enronian in shape.
Green bubble?Begley Jr. is the onlyone who walks his talk.The others look at this to add onto the Manse or overhaul the Family G-V…
How graphic. an inverted hockey stick.
CCX down. Coal doing well. Oil up, gas over $3.00 a gallon.
So much for Green Jobs.
I don’t think that even Goldman-Sachs could make CCX lively at this time.
PaulH (10:53:31) : Enronian in shape.
It might be as low as Enron now but it never went as high.
I know there are people in Wall St. that would do the same with CCX as they did with Enron if they saw the same potential for it. With the earth cooling it looks like that potential is dying.
All I can say is buyer beware.
If the plan goes forward as expected, the rise in prices will be government-mandated….The feature of this plan that has special appeal to speculators is that the “cap” on carbon will be continually lowered by the government, which means that carbon credits will become more and more scarce with each passing year. Which means that this is a brand new commodities market where the main commodity to be traded is guaranteed to rise in price over time.
http://www.rollingstone.com/politics/story/29127316/the_great_american_bubble_machine/7
Pachauri == Al Gore == Madoff
Ecotretas
Carbon tax is yet another of the insanities proposed by this new administration.
Question: Who was the last President to raise taxes during a recession?
Hint: His last name was Hoover.
While those who fail to learn from history’s failures are doomed to repeat them, the unfortunate part is that they drag the rest of us schlubs along, too.
All I want to know is how can I get on a board? Any board. Any advisory committee, as long as it pays. I’m not as tall as Ed Begley, Jr, but I was a Boy Scout once. (Yes, I know, overqualified)
Here’s a cheery note. Since carbon credits are an artificial construct, failure of carbon tax legislation like H.R. 2454 will have a deleterious effect on the profits of climate profiteers, one Nobel laureate/Oscar® winning ex-politician coming to mind.
That is all. Resume thread.
It is interesting that Ed Begley Jr is on the board of this exchange. I met him last month at a green awards event in Hollywood, where in his speech he commented, “whether or not you believe that were responsible for global warming, energy independence from the middle east is just smart policy for our national security…”
Could watching how his exchange is tanking be educating him to greater openness of mind about the issue?
We need some jokes about ‘carbon decay’.
How long is the half-life of a CarbonOxide Credit?
As long as it takes for the seller of the paper to get on the next flight for Rio.
Green Job: What you call it when you just had your wallet emptied of Greenbacks in exchange for the a freshly printed Carbon Credit.
Green Credit: The accolades you get at a Green Rally. Atta boy.
Green Energy: Used to be called Perpetual Motion, now it’s looking more like a recipe for a BrownOut.