New Zealand begins emissions trading scheme, meanwhile the Gore/Pachauri Chicago Climate Exchange is flatlining

The months of flatlining at the Chicago Climate Exchange (CCX) should be a hint to the rest of the world that carbon trading is dead. Time to take it off life support. Even at 10 cents a ton, nobody wants it. At it’s peak in July 2008, it traded for $7.50 per ton of CO2.

Chicago Climate Exchange close on June 30th, 2010 - click for source

See who is on the CCX advisory board here

From ACM:

Token Gesture Alert as the government of New Zealand, unable to think straight thanks to years of green environmental propaganda, brings in its emissions trading scheme.

New Zealand emits about 0.1% of global CO2. So even if New Zealand reduced its emissions to zero overnight, AND it were demonstrated that the climate sensitivity is large enough to notice (which it hasn’t been), it would make not the slightest bit of difference to the climate.

Not only that, but I hardly think that China and India are going to look at New Zealand, and, wracked with guilt and remorse by the plucky little country’s valiant efforts to save the planet, stop their coal fired economies in their tracks. Not on your life. China and India are far too busy building their prosperity and lifting their populations out of poverty. It’s only wealthy countries can afford the luxury of pointless environmental gestures like this.

So the only result will be higher prices for poor Kiwis. Everything will cost more: electricity, petrol, groceries, consumer goods – everything – since everything (virtually) requires energy for its production or transportation. As the ABC reports:

New Zealanders are bracing for higher electricity and fuel prices with the introduction of an emissions trading scheme (ETS).

From today New Zealanders will pay around three cents a litre more for fuel.

Electricity bills are set to increase by up to 5 per cent as companies pass on the costs of buying carbon credits to consumers.

Environment minister Dr Nick Smith says New Zealand had to act because its greenhouse gas emissions have increased by 25 per cent over the past 20 years. [So from absolutely tiny, to slightly less absolutely tiny]

“It’s actually about New Zealand starting the path, starting the change to a less carbon intensive economy,” he said. (source)

Good luck with that. Just watch your industries move offshore, and your economy decline for no purpose whatsoever.


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This really is good news- for someone in Australia having NZ competitors who used to compete well-until now.


Isn’t it now winter time in New Zealand? I hope I don’t have to count too many dead people from freezing cold that far down under this year. It’s the sleepy Sun stupid.

Evan Jones

Pish-posh! It won’t be to no purpose at all. It will be to environmentally unregulated countries and the result will be FAR more (and more dangerously polluting) emissions. That is to say the carbon trading scheme will, by NZ lights, increase environmental damage.

Peter S

Yup. It is cold here in N.Z. Frost this morning, and, after a pleasant, sunny day, shaping up for another one tonight.
N.Z. managed to be the first country into recession last year (ahead of the stock market crash in the US), thanks to our previous Labour (mis)government.
Now they are again trying to be first lemming off the cliff with Indulgencies (sorry ETS).
Before you laugh too much, I’d better warn you that the architect of much of this (our former P.M.) now holds one of the top jobs (Economic Development), with a budget of billions, at the U.N>

Phillip Bratby

No conflict of interest in the CCX Advisory Board then!


Of course we in New Zealand have been trying to convince our politicians to ignore the climate change hoax. I say “hoax” because that is the word used by the leader of the NZ opposition, John Key, in 2005. See Hansard below.
Now that John Key is the Prime Minister of NZ, he has just introduced the world’s first comprehensive EmissionsTrading Scheme today.
JOHN KEY (National—Helensville) : I rise on behalf of the National Party to give the good news to the people of New Zealand—that is, the Climate Change Response Amendment Bill is a load of rubbish and the National Party will not be supporting it, for very, very good reasons indeed.
I want to start off with a broad-ranging discussion, if I may, around the Kyoto Protocol and the absolutely nonsensical road that this Government is taking New Zealand down. I know we have a Prime Minister who is very confident, and all the rest of it, but maybe she would like to step out of her office on the 9th floor and realise which planet she is on. She is on the same planet, she may be surprised to learn, as India, China—
Hon Ken Shirley: And Mugabe.
JOHN KEY: And Mugabe, yes—and a lot of other countries out there that have ratified the Kyoto Protocol. And why would they not, because they have absolutely no requirements on them, whatsoever. Yet here we are down in New Zealand, a very little country with about 0.2 percent of the world’s emissions, putting a self-imposed straitjacket on our businesses, and waving a huge flag that says: “Foreign investment, don’t come anywhere near us. Australia is over there—the West Island. Go over there to pour your dollars in.” To the Chinese we are saying: “Come in and buy as much coal as you like from our West Coast. We’ll sell it to you and you can burn it without a carbon charge—but, by the way, to those back here in Aotearoa New Zealand we will be slapping on a carbon charge and you won’t be able to operate.”
This is a complete and utter hoax, if I may say so. The impact of the Kyoto Protocol, even if one believes in global warming—and I am somewhat suspicious of it—is that we will see billions and billions of dollars poured into fixing something that we are not even sure is a problem. Even if it is a problem, it will be delayed for about 6 years. Then it will hit the world in 2096 instead of 2102, or something like that. It will not work.
Let us have a look at the Government’s response to the Kyoto Protocol. Our friends in Australia said they do not want a bar of it. They do not want to know anything about it; neither do our friends in America. I saw George W Bush, the President of the United States of America, talking about the Kyoto Protocol on CNN one night. George Bush is not necessarily known as the most eloquent speaker in US history. He is a fairly straight shooter, but he is not necessarily seen as being one of the great orators of all time. I plugged in the TV set, turned it on, and what did I see? There, on CNN, late at night, at about 11.30, was George Bush saying that America would not be ratifying the Kyoto Protocol, because it is not good for jobs and it is not good for the American economy. I understood that. I got it. Then I saw John Howard, the Prime Minister of Australia, addressing the Australian people and saying the same thing—that it is not good for jobs and it is not good for the economy. So when I turned to New Zealand TV and found out that we not only would be ratifying the Kyoto Protocol but in fact would be the first country in the world—that is right—to be blazing a trail to put on a carbon tax, I was somewhat astounded.

David L

I have a bunch of dot-com stock I’d be willing to trade for some carbon. Preferably the diamond kind of carbon.

Richard Steckis

NZ’s ETS is not receiving good press either in NZ or Australia. Most regard it as economic suicide.


“Neither a man nor a crowd nor a nation can be trusted to act humanely or to think sanely under the influence of a great fear.” -Bertrand Russell, philosopher, mathematician, author, Nobel laureate (1872-1970)
via A.Word.A.Day, with Anu Garg


When you start with Carbon Credits, you essentially start a new economy, based on ….air.
Its a google translation, but you get the picture;


Can carbon credits be swapped for a massage, do you think?

Richard Steckis says:
June 30, 2010 at 11:06 pm (Edit)
NZ’s ETS is not receiving good press either in NZ or Australia. Most regard it as economic suicide.

You mean they are going to fall on their sword and commit Hari Kiwi?
This one is neat demonstration of the extent to which yo can trust politicians who espouse strong convictions one year, and do a volte face the next.
Time for the people of New Zealand to blockade their parliament and conduct a ‘velvet revolution’.


I’ve been writing to MPs here in NZ but to no avail. Today, I feel quite depressed.

I’ve been reading up on the CCX a bit more. The CFI spot price is only one of a number of traded carbon instruments, and IMHO it is pretty worthless primarily because while it is a common security that CCX themselves created, its not really recognised by any of the authorities that regulate emissions trading, so its a bit of a wooden nickel. California seems to have their own instrument, which is also traded at CCX and is actually pretty highly valued, as are those registered and recognised by the northeastern states.
I’m going to investigate this stuff further, see if maybe I can figure out how to “get rich sending these guys to the poorhouse” as Eddie Murphy said in Trading Places.

I was chatting today with one of my colleagues about the economics of climate change and ETS’s and the like – he’s from China and been in Oz for a couple of years and really didn’t have an opinion one way or another about it, other than he ‘knew about CO2’
I showed him a graph of global CO2 emissions by country over the last 20 years (one of those standard ones that are easily available with a 2 minute google search – actually, the one I found was a pie chart from 2008 from the energy institute of Japan to be exact – and simply pointed out that Australia emits 1.4% of the worlds total CO2.
Its then a simple logical step, like you say about NZ, that even if the entire country of 22 million people shut down everything for 100 years, this would achieve bugger all of an effect on anything, even at the worse case dire ‘the sky is falling’ predictions. Infact, the USA could do the same thing, and that would only manage less than 20% of a reduction, which at the known rate of warming, would really mean very little in real terms (given that the effects of CO2 is not even a linear predictable thing)
And all this is without any climate science whatsoever. Add in the real known science, remove the tipping points and feedback loops that don’t seem to be match anything in the real world, and we laughed and started talking about football.
Sorry NZ, your leaders have failed you.


The effect of human emission of CO2 on global mean temperature is nil.
Here is the data from Climate Research Unit of the University of East Anglia for the global mean temperature anomaly from 1880 to 2010.
This data shows a long term linear warming trend of 0.6 deg C per century.
To clearly see the oscillating pattern of global mean temperature, we remove this long term linear warming trend of 0.6 deg per century and remove the noise by calculating five-year global mean temperatures to get the following graph:
This graph shows the following:
1) 30-years of global cooling from 1880 to 1910.
2) 30-years of global warming from 1910 to 1940.
3) 30-years of global cooling from 1940 to 1970.
4) 30-years of global warming from 1970 to 2000.
Based on the above pattern, assuming there is no shift in climate in the coming 20 years compared to the last 130 years, it is reasonable to predict:
5) 30-years of global cooling from 2000 to 2030.
Conclusion: Global mean temperature is cyclic. As a result, the effect of human emission of CO2 on global mean temperature is nil.

John from New Zealand

The introduction of the Emotions Trading Scam really pisses most Kiwi’s off. I can’t understand how Nick Smith (Minister of Climate Change Conjobs) can say we have the highest CO2 output per head of population when we generate a large part of our electricity from hydro dams.


another spain I am afraid

Carl Chapman

Sorry Geoff, I have to disagree about it being good news for Australia. We have an agreement with NZ that when people move from one country to the other, they can go straight on the dole in their new country. Where will the Kiwis go when their industries fold?

Pete Hayes

My sympathy goes out to the Kiwi electorate. John Key, the Prime Minister is obviously as underhanded as the UK’s politicians. Does this mean I will have to pay more for my N.Z. lamb and butter?

Cassandra King

Carbon credits and the trading system used to trade those credits and the financial institutions and individuals who will reap great rewards at the expense of those least able to afford to finance it all.
Who benefits?
No reduction in global carbon dioxide emissions will result and no temperature difference will be noticed, it seems on the face of it as pimped by the architects of the scheme(scam) that this is simply and exclusively a moral leadership gesture to show the lesser parts of humanity the way forward.
However this utter monstrosity is dressed up and disguised it still looks like what it is, a money making scheme to enrich a minority at the direct expense of the majority and sold as a moral crusade. The money raised will go towards buying off areas of third world governance especially vulnerable to bribery and to create the global finance/taxation base for a new global governance model.
The actual result apart from the above will be to sabotage humanity just at the very moment is our destiny when we need an industrial and technological and economic explosion on a par with the industrial revolution in the 18th-19th centuries. Just as the Luddites attempted to sabotage industrial devolopment the Luddites of the 21st century are trying to do the same thing, the difference is that the latter day Luddites have control of the political classes and scientific institutions.
The ONLY key to our survival as a global race is cheap and plentiful and reliable energy supplied to a dynamic capitalist wealth creating free trade global economy, we are at the threshhold of a truly exciting future and the only things standing in our way are fear and ignorance and selfish self interest of an ignorant minority.


Isnt this the one world goverments plan to have a level playing ground. To lower the living standards of the wealthy countrys and rise the living standards of the 3rd world countrys so then they can bring in a one world currency. you wont find a poor country paying a ETS Tax.

No worries about major industries moving off-shore, they all left years ago. All we have now is huge Aussie companies raping the economy.
All New Zealand is doing now is selling off real-estate to China – and soon at very discounted prices thanks to the crippled economy
… and yes… it is cold here at present – time for another log on the fire – and surprise surprise no Tax on that !!!

Jack Simmons

Training Film For Carbon Trading Salesmen

Al Gored

Beautiful country. But, apparently, too many sheep.
Will be interesting to see how long this scheme will last.


NZ population is 4,368,683, not 22 million, so an even smaller effect on global CO2.
NZ needs tourists, but ETS will not help.

Ok for the unenlightened, here is a list of the different emissions trading instruments you can trade on CCX:
Product Description
SFI® Futures and options contracts based on U.S. EPA Acid Rain Program SO2 Emission Allowances
NFI™ Futures and options contracts based on U.S. EPA CAIR Annual NOx Emission Allowances and U.S. EPA NOx
“Ozone Season” SIP Call Emission Allowances
RGGI Futures and options contracts based on CO2 allowances under RGGI, a cap-and-trade program comprised of ten
participating New England and Mid-Atlantic States
Futures and options contracts based on the Carbon Financial Instrument (CFI), a greenhouse gas emission spot
contract issued by the Chicago Climate Exchange under its a voluntary but legally binding cap-and-trade system.
CFIs with expirations starting in 2013 require delivery of GHG emission allowances that comply with a potential mandatory
federal U.S. greenhouse gas cap-and-trade program
Futures and options contracts based on California Climate Action Registry CLIMATE RESERVE TONNES™ (CCAR
CER Futures & options contracts based on Kyoto-compliant GHG reduction credits issued by the UN for approved and
verifi ed projects in developing countries
So, of these, its the CFI spot price that is flatlined at .10 per tonne. The 2013 CFI-US futures, however, have picked up value in recent months (after tanking during Hopenhagen) as anticipation of a successful passage of cap and trade in congress raises hopes that those 2013 futures are actually going to be worth a bit more than jack and squat when time comes to deliver the GHG contracts.
Since California has an operating legal regime of granting carbon credits and requirements that polluters buy them, the CCAR trading remains at decent value. Definitely down from their prior peaks, but not dead by any means.
The primary problem with the CFI spot price is that no governments recognise the CFI instrument yet, so its pretty much worthless, but the other instruments on the exchange, particularly the Sulphur Dioxide and NOx emissions trading, remains operating at decent value since there are EPA requirements on these.
Imagine that JP Morgan’s Federal Reserve Bank started issuing Federal Reserve notes before the Federal Reserve Act of 1913 passed. They’d be pretty much worthless without the legal imprimature that makes them matter, right? Same thing with the CFI spot price.

John Wright

Pete Hayes says:
“July 1, 2010 at 12:05 am
My sympathy goes out to the Kiwi electorate. John Key, the Prime Minister is obviously as underhanded as the UK’s politicians. Does this mean I will have to pay more for my N.Z. lamb and butter?”
You probably will but for the past three months or so, French supermarkets have been selling NZ lamb at rock-bottom prices…


Will this mean that the All-Blacks rugby team will be giving up flying around the world? Be a bit of a relief to be sure.


The months of flatlining at the Chicago Climate Exchange (CCX) should be a hint to the rest of the world that carbon trading is dead.
Here in Europe the Great Carbon Swindle is proceeding nicely. The thieves want a floor price setting though, just to be safe. OPM you can just never steal enough.
Seem to remember the US fighting a revolution to sever itself from European swindling.


In a way this is good news for Australians, although I feel for our brothers and sisters across the pond. Aussies will now see the kind of inflation and other economic rammifications of an ETS we could expect should we be crazy enough to vote in a scheme of our own.
At the moment our new PM is too busy arm-wrestling with the mining industry in the name of fairness… yes, because it is distinctly unfair that the mining industry pay the same level of corporate income taxes as other industries…


John Wright says:
Nah because the Kiwi dollar (peso?) will tumble relative to the Aussie dollar, so the Kiwi products will still be cheap 🙂


Jack Simmons says:
July 1, 2010 at 12:13 am
Training Film For Carbon Trading Salesmen

ROTF! That made my week! And properly he’s all GREEN!
Or is that ‘N’ better as a ‘D’?


The one thing that worries me is NZ’s got a habit of doing something completely asinine, then about half the time siting back and laughing their asses off as every other country in the world follows suit – no idea how that works, but it does – mind you the other half of the time they find themselves navigating an inland waterway without a means of propulsion 🙂
As for the Chicago market…I’m still waiting for it go lower (10c per kiloton?) – I so want a stock certificate to frame on my wall.

stephen richards

John from New Zealand says:
June 30, 2010 at 11:54 pm
The introduction of the Emotions Trading Scam really pisses most Kiwi’s off. I can’t understand how Nick Smith (Minister of Climate Change Conjobs) can say we have the highest CO2 output per head of population
You haven’t. Last time I saw a UN sponsored estimate it was Qatar.


Word fail me. I have been working to have the ETS abandoned.. and failed. We’re the laughing stock of the developed world. Shame on Prime minister John Key. Shame on Environment minister Nick Smith. You have betrayed us.

Richard Sharpe

jorgekafkazar says at June 30, 2010 at 11:22 pm

Can carbon credits be swapped for a massage, do you think?

While I am sure Al Gore is interested in emissions trading, it’s not CO2 emissions that he is talking about.


Most regard it as economic suicide.
catastrophic AGW it is?
the current ETS show a fall in prices, because too many certificates are handed out. falling prices area feature of the current schemes, not an error. (they are an error for global climate though..)
over time, with fewer and fewer certificates being handed out for free,things will change.
posts like this one, demonstrate a lack of understanding of markets, lobby power and emission trading. sorry Anthony.

The Silent Majority

And the only political party to argue (no, fight) against the ETS is the ACT Party in NZ. They were treated as idiots and laughed at, scoffed at and called climate change deniers by the MP’s of every single other party.
But they still keep going. NZ desperately needs politicians like them!

Pissed off Kiwi

I worked for John Key during the last election and I even had lunch with him. I am not going to vote for him based on the ETS alone.
I will vote Greens as the ETS has stuffed NZ up big time and we may as well go down the swanny quickly.
Nick Smith’s new name is Thick Smith.


Perry says:
July 1, 2010 at 12:18 am
NZ needs tourists, but ETS will not help.
Thats right all tourists will be paying too.

Flying Kiwi

As a Kiwi who left NZ 30 years ago to live in France and Germany, I can only say that this latest exercise in ruinous socialist economics does not surprise me. The country has been going down hill for years and Kiwis have been fleeing in droves to Australia and further afield. They are being replaced by Asians. More than any country I know, it has a political culture that is dominated by left-wing elites and is totally in thrall to political correctness. Only the UK may be worse.
I do not recognize my country anymore.

John Silver

“Even at 10 cents a ton, nobody wants it.”
Since there are no buyers the price isn’t 10 cents, it’s 0, zero, nil, nada, rien, nichts u.z.w.
And it will stay that way, the New Zeelanders are buying nothing.

Peter Miller

Presumably if New Zealand is the first country to enter the economic abyss caused by carbon trading, then hopefully it will be one of the first out of it, once their politicians finally realise the stupidity of this.
This is a political gimmick of the ‘greener than thou’ kind, beloved by politicians with no experience of the real world outside their own murky world of politics.

Ozzie John

Would the last NZ person to emmigrate to Oz please remember to turn off the lights !


They’ll already be off.


We’re not all off to Oz Ozzie John, we are off to Canada.

It will be interesting to see how this fails, because fail it will. The whole idea of these instruments is to reduce their number over time, thereby limiting CO2 emissions, but I wonder how many people have really thought it through.
We are told that we have to lower our emissions by 80% from current levels, i.e. from 30 gigatons to 6GT. Our current emissions from breathing out are about 2GT and that will rise to nearly 3GT when our population inevitably grows to 10BN. That leaves us just 3GT to emit for all other activities, such as feeding, clothing and shelter, and that simply can’t be done. We wouldn’t even be able to build windmills to power ourselves at that rate. Even “government” would be impossible, we’d be back to feudal times. Feudal law might have “worked” when there was only a 100million of us, but with 10 billion?
Paul Hanlon.

Sally McIntyre

Reported in the Southland Times 25-08-2003
“National Party agriculture spokesman David Carter who, along with leader Bill English took part in the march, said an increasing number of scientists were now disputing the issue of global warming. By signing the Kyoto Protocol on climate change New Zealand had put itself at a hugely significant disadvantage, Mr Carter said. “Farmers are saying enough is enough. My advice to farmers is to keep the pressure on the Government because I think the Government will back down.”
Southland Times 08-08-2003
“National Party leader and Clutha Southland MP Bill English told the 50-strong crowd they were being asked to pay for speculative ventures that would struggle to meet the requirements of the Government’s own scientific research fund, while other countries waited for New Zealand agriculture to lose its competitive advantage.”
July 1 2010
At least twelve of the current National MP’s took part in the ‘fart tax’ March in 2003.
As well as the now Agriculture Minister David Carter and Finance Minister English there was the Minister of Environment, Climate Change and ACC Nick Smith, Police Minister Judith Collins, Fisheries Minister Phil Heatley, Associate Finance Minister Simon Power, Health Minister, Tony Ryall, and also Shane Ardern, Sandra Goudie, Paul Hutchinson, Alan Peachy and Lindsay Tisch.
Great cartoon at “JULY FOOLS DAY”

John from New Zealand says:
The introduction of the Emotions Trading Scam really pisses most Kiwi’s off. I can’t understand how Nick Smith (Minister of Climate Change Conjobs) can say we have the highest CO2 output per head of population when we generate a large part of our electricity from hydro dams.

Maybe he was talking about the methane CO2 equivalent from all those head… of sheep?
So when will they be fitting gas collecting diapers to all them white fluffy ’emitters’?
And do you get ‘carbon offsets’ for all the CO2 sucked out of the air by your magnificent forests? (Do the math… trees suck out more than cars put in…)
On Markets:
In options trading, the ‘zero price’ is usually a nickel. This is so that strategies that need offsetting puts and calls can be completed, even if one leg of the trade is worthless on its own. So you will regularly see worthless calls and puts trading for $0.05 and sometimes with a bit of volume.
My take on the $0.10 price is that it’s a ‘zero’ functionally.
Oh, and per California and our wonderful success with our Carbon Cap and Tax … did anyone notice that our government is functionally bankrupt and we’ve got some counties with unemployment of 25% type scale? But our emissions are sure dropping fast. Don’t get much CO2 emitted from closed factories…
FWIW, my spouse has agreed that it’s OK if we move out of state… This from a person who would not even think of leaving the CITY just a couple of years ago. Perhaps something to do with the State issuing IOUs … and cutting working hours back (she’s a teacher) with unpaid days off… and cutting benefits… and rising prices…
But at least we can glory in knowing that we’re more smug than the folks without an ETS.

In fairness to Mr Key, he had a fairly sound reason for the ETS, a scientifically flawed as it is. NZ is completely upon trade and tourism and leans heavily upon a clean environmental image; John Key’s position was that to fail to have an ETS would be bad for business and he was even worried there might be trade retaliation. NZ has been the victim of unjustified and unethical trade practices by the USA and Europe, on equally spurious grounds in the past, so this is not a fantasy.
If you smug know-it-alls from the USA, Europe, Britain and Australia would please make more of an effort to persuade your own countrymen of the folly of AGW, instead of wasting your time chuckling at poor, vulnerable New Zealand, we would all be better off.