Chicago Climate Exchange drops 50%, new record low

The only lower price than today’s closing price on a ton of carbon is ZERO

Perhaps reacting to the news yesterday about the IPCC getting taken to the woodshed, the growing number of stories in the MSM about the IPCC failure, and the recent layoffs at CCX, carbon trading has once again been devalued by the market. Amazingly, it lost 50% of it’s value for 2006, 2007, and 2008 “carbon instruments” today. Here’s the CCX front page graph at closing today:

The CCX end of day table really says it all, 50% off, from a dime to a nickel in a day:

CCX end of day, August 31, 2010

It must have really killed the person to have to put in a nickel for the closing value today.

Charcoal briquettes and coal have more value than a ton of CCX carbon instruments these days.

Unless CCX starts making adjustments in single cents, the next downward adjustment is zero. The latest CCX advisory says they will be closed for labor day, and will reopen for trading September 7th. One wonders.


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Exactly what hot air is worth – virtually nothing!

H.R.

Good grief! It’ll soon cost more in the electrons used for the trade than the credits will be worth.
The rats have left the building (at $7.00) leaving only the faint aroma of stinky cheese.

Rattus Norvegicus

Well, doesn’t surprise me given that cap ‘n trade, or any other form of regulation is pretty much dead. Vive le market and all that!

R. de Haan

Banks are exiting the carbon market like Deutsche bank:
http://www.reuters.com/assets/print?aid=USTRE67A3JK20100811
That and the current carbon prizes tells us that for the moment the climate fight is over:
http://www.washingtonexaminer.com/opinion/blogs/Examiner-Opinion-Zone/How-you-know-the-climate-fight-is-over-101807708.html
So why is it that I still have this gut feeling that our political establishment will give it an ultimate push to shove this cap & trade monster down our throats?
Blinded by absolute power these guys will push their limits to get this done, even if they go down trying.
This still isn’t over.

Brent Matich

Now is your chance to get in at the bottom! LOL! The greasy slime balls made their money , now all there is left is the poor misguided tree hugging uber enviro nut cases who use one square of toilet paper to go to the bathroom with . Wake up guys it’s all a scam.
Your Friend
Brent In Calgary

polq

There is Quebec, Ontario and British-Columbia that is entering to the Western Climate Initiative. At this price, they will buy some carbon credit for sell it at a higher price. Am I correct???

Skeptic Tank

Maybe Al Gore will step in and do some bottom feeding.

Gnomish

This is a good sign.
But now watch for the bail-out/subsidies.

“The patient is dead, Jim.”

Bill H

I wonder if Al is now shorts less…

Michael

I am so proud to have been instrumental in the demise of the worldwide carbon market. That was my current life goal.

The U.S. DOE (Department of Energy) has just spent $253 million to fund a CCS (carbon capture and sequestration) project for Air Products, an industrial gases supplier. The project (see link below) will capture CO2 from two existing process plants in an oil refinery in Port Arthur, Texas, then compress the CO2 into a pipeline for use in enhanced oil recovery. The two process plants are SMR – Steam Methane Reformers – that produce hydrogen from natural gas. The hydrogen is used in several refining processes.
The CCS systems will reportedly capture 1 million tons of CO2 per year. If merchant CO2 is sold for $30 per ton, as some sources report, then the Carbon Emissions Credit must be approximately $45 per ton to obtain a total revenue of $75 per ton, which then gives the project a 5 year simple payout or 20 percent (approximately) return on investment. Note that, if such increased production of CO2 becomes commonplace, the glut of CO2 in the market will depress CO2 prices. Thus, if merchant prices decrease to $20 per ton of CO2, then the Carbon Emissions Credit must increase to $55 per ton make up the difference. That’s a long way from 5 cents per tonne.
http://www.airproducts.com/PressRoom/CompanyNews/Archived/2010/16Jun2010.htm

pat

wish some sceptics would picket the CCX!
anthony, u may be interested in this win for aussie farmer, Peter Spencer:
1 Sept: FarmOnline: Lucy Knight: Peter Spencer wins his day in High Court
PROPERTY rights crusader, Peter Spencer, who went on a hunger strike on his southern NSW farm earlier this year, has broken down outside the High Court in Canberra following an unanimous decision in his favour to finally have his case heard…
But the High Court today ruled that Mr Spencer has a case to be heard, and that there was essentially no case to stop it from being heard.
The High Court also ruled the Commonwealth pay full costs for Mr Spencer…
He hugged supporters outside the court and broke down when asked what the ruling meant to him and all Australian farmers.
Mr Spencer said the decision means “rural Australia will now have hope”…
“When I first spoke of carbon 13 years ago, people said ‘what are you talking about?’
“It has been the biggest lock-up, the biggest takings, in the free world out of war time.
“It represents 109 million hectares. 90 per cent of Australian land was stolen from the people and used to meet an international carbon treaty when it should have been taken from the coal-fired power stations.
“This was a cover-up of the worst proportions.”…
http://fw.farmonline.com.au/news/nationalrural/agribusiness-and-general/general/peter-spencer-wins-his-day-in-high-court/1929375.aspx

It is not actually the price for a tonne of carbon but the price for a tonne of CO2. Nevertheless, even though you get a substantial amount of oxygen thrown in with the carbon you buy with a tonne of CO2 for a nickel (or perhaps soon for nothing), it is still worth nothing.
If Al Gore’s put his money where his mouth is, a good portion of his $200 million in assets is tied up in CO2 credits. That would make the value of his assets fall faster than the temperatures in the Arctic possibly could.

I love how instead of using a header ID of year they use “vintage”, like the CC’s are a bottle of fine wine. So sticking with the wine theme what the Alarmists ended up with was Maddog 20/20 (click link for those that don’t know what MD 20/20 is: http://en.wikipedia.org/wiki/Low-end_fortified_wine ) instead of the Chateau Mouton-Rothschild Jeroboam they thought they had.

DCC

The article leaves the impression that the CCX is closed tomorrow (Sept. 1st) through the labor Day three-day weekend. That’s not the case. They will be open through Friday the 3rd.

Glenn

http://www.chicagoclimatex.com/content.jsf?id=801
“Entities or individuals who trade on CCX for purposes other than complying with the emissions reduction requirements, such as market makers, CTA’s, proprietary trading groups, hedge funds and local traders may join the Exchange as Liquidity Providers.”
Te-he. I can think of better things to “provide liquidity” to than to these bozos.

tim maguire

It’s wildly overpriced at a nickel. As others have pointed out, what does one get for their purchase? Nothing. They’re selling…not even air. I could see if this were a futures market where they were taking bets that carbon would some day be rationed, but today it isn’t, so they’re selling…what?

savethesharks

R. de Haan says:
August 31, 2010 at 7:04 pm
Blinded by absolute power these guys will push their limits to get this done, even if they go down trying.
This still isn’t over.
=========================
I agree. We need to be vigilant. The battle is really only beginning.
Chris
Norfolk, VA, USA

Will Delson

Good times.

wws

Okay, being the contrarian I am, that’s good enough for me! I’m IN!
I hereby bid ZERO for 1MILLION TONS of CARBON! I am gonna corner the market!!!
And I gots the money to back that bid up, too!!!!

BillyV

I wanna buy 16 tons. Where can I send my 80 cents? The document would make a nice wallpaper or souvenir.

Girma

It is a great pleasure to see the attempt for the unproductive to create a product out of thin air falls to the ground.

rbateman

Isn’t Al Gore heavily invested in that exchange?

TomFP

Reminds me of the title of one of Seasick Steve’s albums “I Started out with Nothing, and I’ve Still got Most of it Left”
http://www.seasicksteve.com/

Milwaukee Bob

R. de Haan said at 7:04 pm
This still isn’t over.
NOT BY A LONG SHOT! WAY TO MUCH MONEY INVOLVED – –
Climate Exchange Plc (CLE) is an AIM listed company which owns:
Chicago Climate Exchange (CCX), launched in 2003
The European Climate Exchange (ECX)
Chicago Climate Futures Exchange (“CCFE”)
Insurance Futures Exchange Services Ltd (IFEX)
California Climate Exchange (CCEX)
Montréal Climate Exchange (MCEX)
Wilderhill Clean Energy Index (ECO index)
December 2007 CCX announced the signing of a memorandum of understanding with the Chinese National Petroleum Corporation Assets Management (“CNPCAM”)to create a joint venture company to explore the feasibility and implementation of an emissions trading platform in China.
July 2008 CCX signs agreement with China national Petroleum Corporation Assets Management Co. Ltd and the City of Tianjin to jointly engage in emissions trading in China.
IFEX launches Florida Wind and Gulf Coast Tropical Wind Futures
CCFE Announces the Successful Launch of Futures Contracts on California Climate Action Registry
CCFE launches Renewable Energy Certificate (REC) Futures
Australian Envex Exchange
http://www.climateexchangeplc.com/company-history
AND GUESS WHO WAS THERE RIGHT AT THE BEGINNING? IN CHICAGO….
From Bloomberg:
Richard Sandor, Barack Obama and the Founding of the Chicago Climate Exchange
Legislation to let polluters buy and sell carbon-dioxide emissions like pork bellies is the outgrowth of Richard L. Sandor, founder of the Chicago-based network of people trading pollution permits from Beijing to Brussels known as Climate Exchange. It doesn’t hurt that the six-year-old market got $1.1 million of seed money from the city’s Joyce Foundation, whose board included a little-known state senator named Barack Obama.

http://www.climateexchangeplc.com/investor-relations/directors
I would place NO bets against this gang.

AEGeneral

If I had a nickel for every time someone told me this was going to happen, I’d be….uh…..
never mind.

jeef

Meanwhile in NZ the government designated value per tonne is NZD25…
Thanks, green party.

Dave Dardinger

For BillyV & Kim
You buy sixteen tons
of carbon dioxide gas
and what do you get?

Methow Ken

Can anybody say ”flat-lined” ??…
If only we could have gone big-time short during the ”good times”. . . .

Harry Bergeron

They are getting what they deserve.
Now, our job is to avoid getting what they deserve.
I’ve heard that some labor union pension funds put money there.

Lew Skannen

Let’s see them try to hide that decline.

Paul Deacon, Christchurch, New Zealand

It doesn’t matter if the price is 5 cents or 5 million dollars, if it doesn’t trade at all (that’s what the graphic appears to show).

Evan Jones

Hmm. Do they actually provide you with certificates?
Maybe I’ll invest a few bucks. Enough to make a suit of clothes out of them.

Duke C.

It’s not likely that the CCX is shutting down anytime soon. They have a booming market in a wide variety of products.
Nitrogen futures, Sulfur futures… they even trade Florida Tropical wind futures.
Link to an XLS spreadsheet, price history for all products traded in 2010 (4.2 megs):
http://www.ccfe.com/mktdata_ccfe/sfi/historical/Historical_Prices.xls
XLS 2010 trading volume:
http://www.ccfe.com/mktdata_ccfe/historical/CCFE_Monthly_Volumes.xls

Evan Jones

Florida Tropical wind futures
So they also sell hot air?
Nitrogen futures, Sulfur futures…
Does a handbasket come with that?

redneck

Bill H says:
August 31, 2010 at 7:29 pm
“I wonder if Al is now shorts less…”
I understand that had already occurred a few months back in Portland, Oregon.

JEM

Dear Congressman Waxman, if I go out and buy a million tons on the CCX can I have a lifetime exemption from all carbon fuel taxes, maybe even a subsidy?
Maybe that way I could afford a Gulfstream…

BillyV

OK– Dave Dardinger,
What do I get?

Scott

Now that’s a real death spiral!
-Scott

ZT

Presumably the infallible computer modelers are investing their grant money right in every possible ‘instrument’ at bargain basement prices.
Right – Mike, Gavin, Phil, Tamino, et al?
In the unlikely event that the models turn out to be wrong – plan-b is a tax-payer bail out.
(or was that plan-a in the first place anyway?)

Leon Brozyna

A century ago, when we still had a semi-free market economy, CCX would have closed shop, dried up, and blown away.
Today, they’ll probably hold out in hopes of some bail-out monies to tide them over till cap-and-trade passes.

William

If they can’t sell the carbon credits, I have some space they can rent on Lower Wacker Drive. It even has a river side view of the lovely Chicago River and they can count cans and bottles as they float slowly by (and whaterver else happens to be floating by)

Arizona CJ

If it drops another ten cents to -.05, then I’ll buy all they’ve got! They’d have to send me a nickle with every share, so I’d pocket the money and, as a bonus, have fuel for my fireplace this winter! 😛

Richard deSousa

Arizona CJ – short the sale… LOL

The Crash Heard ‘Round the World.
By the way, the spot price for Central Appalachia 12,500 Btu, 1.2 SO2 coal this week was $69.50 per ton. Compare that 5 cents per ton for fiat “market” carbon futures.
How do you ridicule the profoundly ridiculous? And when you consider that the Founders of CCX are now managing the Nation’s economy, it is difficult to be amused.

steve

This is an enormous manufactured scam, but consider– if some form of cap and trade passes, even if mandated by the EPA, there could be a boatload of money to be made by bottom-feeding on this stuff.
Hell, if the government is going to kill the economy even worse than it is now and energy prices will go up, this could be just the place to shelter those dollars and actually make some dough. I’ve been trying to work on the “angle” to all of this, and this could be just the sort of investment. If the government is making artificial markets right in front of us, might as well find a way to make some money…

Shevva

Like I said when this exchange started, don’t be to surprised if the politico’s don’t do something about this as it’s a way of taxing people breathing, it’d be legendary in the political world, taxing air simply brilliant in there private bars.
And someone commented around here that the enviro’s where like a water melon, green on the outside, red in the middle, i’d like to thank you for that as i’ve had some of my more intelligent friends rolling around on the floor with that.

Keith Battye

You can guarantee that the gravitational anomaly known to some as Poodle Man has shorted his carbon and can now afford those sea walls around his “global village” on the west coast.
It’s all good.

Kate

The formula: create an investment vehicle, hype the new commodity, buy low, watch share prices rise, sell high. The result is money, lots of it. In some cases it’s been about driving up the share prices of companies Gore’s group has already invested in. The fact that the original shareholders of the CCX have already bailed out with their sale to Intercontinental Exchange Inc. for a modest $600 million earlier this year only reinforces the reality that its creators have already lost faith in their elaborate invention. Likewise, the self-styled leaders of the climate change crusade Maurice Strong and Al Gore have already cashed in carbon fortunes already, whilst other active politicians like US President Barrack Obama, and United Nations IPCC Chief Rajendra K. Pachauri are engaged in similar play with their own financial interests in the “carbon” markets.
Like all government rigged quasi-commercial schemes, the only real beneficiaries are the initial shareholders- a special inner circle who are naturally ahead of the curve knowing about legislation and policy before it comes into existence. They are sometimes called “the great and the good,” “the in-crowd,” or “the smartest men in the room” (again, see Enron). Of these, almost all have jumped ship out of the market while their preferred shares- or in the case of the larger energy and manufacturing monopolies, their gratis “Carbon Allowances” given to them free by their governments- are still worth something. If you’re on the inside, it’s simple- get in early, make a ton of money then get out.
The CCX is flat-lining (though, like Frankenstein’s monster, it awaits re-animation as it’s still not actually dead yet) because the market anticipates Obama losing control of Congress in a few weeks. So “Cap and Tax” is impossible to pass, and Obama has already stated that the remainder of his term will be spent implementing current legislation rather than drafting new laws.