Public carbon trading dead in the USA

Gore’s grand experiment has flatlined.

As we reported almost two weeks ago, the Gore and Pachauri advised Chicago Carbon Exchange (CCX) has closed. Closing price? A nickel per ton of CO2.

Here’s the final day closing page for posterity:

A 16 lb bag of charcoal briquettes is worth more than a ton of CO2. About 220x more.

Here’s more on the story:

Carbon Trade Ends on Quiet Death of Chicago Climate Exchange

By John O’Sullivan

Republican mid-term election joy deals financial uncertainty among green investors as the Chicago Climate Exchange announces the end of U.S. carbon trading.

The Chicago Climate Exchange (CCX) announced on October 21, 2010 that it will cease carbon trading this year. However, Steve Milloy reporting on Pajamasmedia.com (November 6, 2010) finds this huge story strangely unreported by the mainstream media.

To some key analysts the collapse of the CCX appears to show that international carbon trading is “dying a quiet death.” Yet Milloy finds that such a major business failure has drawn no interest at all from the mainstream media. Milloy noted that a “Nexis search conducted a week after CCX’s announcement revealed no news articles published about its demise.”

Not until November 02, 2010 had the story even been picked up briefly and that was by Chicagobusiness.com (Crain’s). Reporter, Paul Merrion appeared to find some comfort that while CCX will cease all trading of new emission allowances at the end of the year, “it will continue trading carbon offsets generated by projects that consume greenhouse gases, such as planting trees.”

Collapse is Personal Setback for U.S. President

Barack Obama was a board member of the Joyce Foundation that funded the fledgling CCX. Professor Richard Sandor, of Northwestern University had started the business with $1.1 million in grants from the Chicago-based left-wing Joyce Foundation enthusiastically endorsed by Obama. When founded in November 2000, CCX’s carbon trading market was predicted to grow anywhere between $500 billion and $10 trillion. Fortunately before its collapse Sandor was able to net $98.5 million for his 16.5% stake when CCX was sold.

Failure of European Climate Market May Follow

Milloy writes, “although the trading in carbon emissions credits was voluntary, the CCX was intended to be the hub of the mandatory carbon trading established by a cap-and-trade law. Trading carbon was, the only purpose for which it was founded.” But with their resurgence after the mid-terms the Republicans have now put a new cohort of global warming skeptics into the corridors of power.

Unlike the American voluntary scheme, the European cousin of the CCX, the European Climate Exchange (ECX), continues to trade due to the mandatory carbon caps of the Kyoto Protocol. But the future of the ECX will be in doubt unless a new climate treaty to replace the Kyoto Protocol is introduced. That treaty expires in 2012. But the ineffectual Copenhagen Climate Conference (2009) exposed an inability among international politicians to agree on climate change. If this stalement persists then the European ECX may likely suffer the same fate as Chicago’s CCX.

read the rest here

Advertisements

  Subscribe  
newest oldest most voted
Notify of
Al Gore's Holy Hologram

weeeeeeeeeeeeeeeeeeeeeeeeeeeeeee plop

We will be needing a carbon exchange in California. Correction: Kooky Kalifornia.
California Cap and Trade is alive and well as part of AB 32, which survived a challenge at the ballot box on November 2. Trading carbon instruments is a key to the program.

DCC

Amazing how such a scam could persist for seven plus years and nobody got arrested. In fact, Professor Sandor appears to have made a bundle of money. Bernie Madoff should have taken lessons from these guys.

May Europe follow and soon.

Jimmy

Didn’t Gore & Co get $600m for this dead donkey earlier in the year from ICE, the sane crowd that run the European equivalent?

If a carbon exchange falls and no one in the MSM is around to hear it, did it make a sound?

Old Goat

I’t’s better than we thought – isn’t it?

Now….who’s gonna protect me from bad kids?!!!!!

Jimmy

ICE buys up Climate Exchange for US$604M
May 01, 2010
http://www.livetradingnews.com/ice-buys-up-climate-exchange-for-us604m-12800.htm
From US$604m to $0 in six months.
A classic financial pump & dump scheme. Carbon trading is the largest fraud ever perpututated on mankind. Obumma.

Dang !!
There goes my plan to organize the homeless and sell their carbon credits.

I am surprised that certain news organizations are not using this to show just how bad big oil is to have killed carbon trading. I suppose the real problem is that the Earth is the biggest trader of all, but it won’t pony up the cash.
Mark up one more bad idea that died a miserable death. Looking back, I think every idea Al Gore ever had ended the same way. Hmmm.. Lets start a market for bad ideas from Al Gore. We can raffle the death date of his ideas. 😀
John Kehr

morgo

R.I.P

Gary

It’s had the red shirt on for a while…

Donald Shaw

Yes, but the suicidal Low Carbon Fuel Standards (LCFS) policy in California will contribute to the demise of the State Economy and require fuel import from “states” less friendly than Canada as the supply from alternative sources fail to meet unrealistic expectations.
The Chinese are already moving in to take up the slack and use the oil from Canada oil sands..
http://www.hydrocarbonprocessing.com/Article/2701411/LCFS-will-adversely-affect-oil-sands-crude-refiners.html?LS=EMS455705
“Purvin & Gertz, Inc., has released a report on the effect low-carbon-fuel standards (LCFS) will have on oil sands. The report notes that LCFS programs are being implemented in California, Oregon and British Columbia. They are under consideration in many other states and provinces and are becoming regional in nature. LCFS programs differ by jurisdiction, but have in common mandated reductions in the carbon intensity of transportation fuels. By targeting petroleum-derived gasoline and diesel and promoting low-carbon alternative energy forms such as electricity, hydrogen, natural gas and next generation biofuels, LCFS programs are intended to reduce overall greenhouse gas (GHG) emissions on a “well-to-wheels” basis.”

Strange, I can hear a song by ABBA around here when reading this. Greed does actually work, to a limit. Here in Sweden we don’t have a trading exchange for carbon emissions but we have had a tax on these emissions for some twenty odd years and it doesn’t work at all. We have more emissions today and more money keeps flowing in for our greedy state.
And the ABBA song? Money, money, money…
/Carl

John Day

Stock prices have always been tenuous entities, reflecting investors’ hopes and fears as much as substantive activities. This CCX demise confirms the utter hopelessness of the concept.

AndrewSanDiego

Star Trek – the cultural gift that keeps on giving? Maybe we could add an Away Team crewman (wearing a red shirt) with a name tag labeled “IPCC”? Heh.

Elizabeth

Great!
But I have a sinking feeling they’ll be back…

Donald Shaw

And for those who placed their bets (and your tax dollars) on Algae as the replacement liquid alternative fuel:
http://biofuelsdigest.com/bdigest/2010/11/05/algal-fuels-just-around-the-corner-or-10-years-away/
Algal Fuels: Just around the Corner or 10 years away?
“ShareAlgae being cultivated in a small-scale micropond at Sapphire Energy headquarters in La Jolla, California
In California, a new report from the Energy Biosciences Institute (EBI) in Berkeley projects that development of cost-competitive algae biofuel production will require much more longterm research, development and demonstration.”
“It is clear,” the EBI scientists conclude, “that algal oil production will be neither quick nor plentiful – 10 years is a reasonable projection for the R, D & D (research, development and demonstration) to allow a conclusion about the ability to achieve, at least for specific locations, relatively low-cost algal biomass and oil production.”
“The report can be downloaded from the Digest’s Biofuels Information Zone, here.”
Authors include Nigel Quinn and Tryg Lundquist of Lawrence Berkeley National Laboratory, Ian Woertz of Cal Poly, and John Benemann. Benemann recently made the Digest’s Top 100 People in Bioenergy list.
“Even with relatively favorable and forward-looking process assumptions (from cultivation to harvesting to processing), algae oil production with microalgae cultures will be expensive and, at least in the near-to-mid-term, will require additional income streams to be economically viable,” the authors noted in a release highlighting their findings.”
“The “10-years away” theme: a gathering of outlooks”
“There are a wider assortment of algal fuel commercialization timelines than crayons in a big Crayola box, but there are a couple of studies that have come out from academia of late that focus on the 10 year horizon. Phil Pienkos, Al Darzins and Eric Jarvis at NREL recently wrote in IEEE Spectrum: “our projections suggest that in the next 10 years or so algal biofuels will be able to compete economically with crude oil costing between $75 and $100 per barrel.”
“That’s also the horizon we see in the work at Sapphire Energy, which is constructing a 1-million gallon demonstration scale facility by 2014, and expects to be at commercial scale production with a 100 million gallons facility by 2018 and at 10 such facilities by 2025. ExxonMobil and Synthetic Genomics, in their communications, emphasize the long-term nature of their R&D work on cyanobacteria-based fuels.”
Key finding: demonstration-scale plants are “premature”
“Overall, this report from EBI is the most comprehensive survey to date that we’ve seen on the economics, and technical challenges for algal fuels.”
“So it is worth taking a long look at the authors’ conclusion that “the building of 100-hectare demonstration plants, with investments of tens to hundreds of millions of dollars, are premature.”

Jason Bair

It couldn’t happen to a nicer bunch of people.

R. de Haan

The EU has plans to blackmail the world into carbon trading.
Every foreign airline with slots on European Airports will have to compensate it’s carbon emissions from 2012.
I really hope the entire scheme goes down the drain but the EU apparatchniks are determined and operate without any democratic control.

pat

No one is reporting on this. I can’t even find it in business periodicals. This is a huge setback for government and Goldman Sachs.

Both sides of the US media intentionally misunderstand the whole Carbon Cult, to serve their own purposes. The Left side (90%) sees the Cult as Good Government Protecting Holy Planet from Evil Humans. The Right side (10% of media) sees the Cult as Evil Government Ramming Big Taxes Down Our Throats.
Neither of these government-centered views is correct. The Carbon Cult, at least for the last decade, has been just one more Wall Street bubble, with the potential for vast theft.
Now that the bubble has turned out to be a money-loser for most of its participants (including the owners of both Right and Left media conglomerates) it will finally begin to fade.

Chris Smith

Just goes to show, the markets NEVER lie.

erik sloneker

They’ll probably want to be trading biodiversity credits next.

Jeremy

Anthony you need to update that graphic of ‘it’s dead Jim’ with one where the good doctor is giving that famous look up to the camera he gives when he says that… something like…
(*time spent doing a google image search*)
..Well, actually, I can’t find anything good either. That’s a shame. I’ve got a lot of the old stuff at home in HD, I’ll screencap and make a new one to serve this internet need. In the meantime, here’s a modern Trek equivalent:
http://jeremy.stoic-epicurean.com/pictures/newbones.jpg

simpleseekeraftertruth

It was bought for $597 million based on the figures stated in the post. Those that invested may want to know more about AGW after that hit. Who did the due dilligence?

Vince Causey

It’s worse than that Jim. He’s dead.

Ian E

Gone with the wind – and, frankly, I don’t give a damn!
Is the end of this insane AGW scam with its trillions of dollar taxes now in sight, or is this just the end of the beginning, I wonder?

dp

This is how the market works. And interestingly, the perps acknowledge that this scheme simply would not work without government imposed regulation requiring cap and trade. Social engineering that ignores the natural motivations of the market can’t work unless part of that engineering plan removes all competing alternatives. ObamaCare somes to mind as an equivalent scheme to forced cap and trade. This is the first signature to look for in any regulation that has as its first principle changing how we live; What choices remain after the bill becomes law?

coaldust

RIP. I won’t be sending flowers.

The long con has been busted.
Don’t expect them to go gentle into that good night, but they may well slink away for a while….

Jimbo

If this stalement persists then the European ECX may likely suffer the same fate as Chicago’s CCX.

With the Republican House upsurge it looks more likely that the stalemate will persisit as China and India might remain rather frosty in the absence of a US endorsement. If the EU goes it alone then expect a steady trickle of heavy industry to India and China.

Engchamp

So, what next? Water? It is becoming more scarce, as overall we seem to be extracting more from the ground than is being replaced.
Oops! Shhh!

Here’s hoping that it cost the backers a pile of money!

Far be it from me to tell others what they should or ought to do. If people are stupid enough to gamble with their money on illogical schemes like trading carbon credits that is their business. Just don’t do it with my money and don’t complain when it all goes bust. That said I was wondering is Carbon Credit Trading was like Papal Indulgences, Since both are based on some religious belief?

Murray Grainger

This is indeed a sad day. NZ still has an ETS scheme which, as a forestry investor, is going to hurt my pocket badly. I was hoping to buy low in Chicago (5c/tonne) and sell high in NZ (shipping costs should have been well covered by the profits) and now this!
Devestated, truly devastated.

Dave

Hurrah! Now all we need is for the imbeciles in Brussels to terminate the ETS.

simpleseekeraftertruth

Looks like Intercontinental Exchange (ICE) bought it “Morgan Stanley advised ICE on the transaction and Shearman & Sterling LLP served as ICE’s legal advisor.” Oops!

Layne Blanchard

Killing off the exchanges – and there are more, I believe, such as in Australia – is only the first step.
To protect the US from State and Regional mandates for Climate nonsense, Congress should pass law forbidding mandates from Federal, State, and Local governments from implementing any form of Carbon limiting law. Then set about de-constructing all the
laws currently in place – which will surely be done in the courts.

PaulH from Scotland

@John Kehr
‘Mark up one more bad idea that died a miserable death. Looking back, I think every idea Al Gore ever had ended the same way. Hmmm.. Lets start a market for bad ideas from Al Gore. We can raffle the death date of his ideas.’
That’s a fabulous idea, and almost identical to the one Goldman Sachs had when they made a killing on selling dodgy investments to their clients whilst simultanously taking on out huge insurance policies (Credit Default Swaps) on their guaranteed failure.
And the thing is, I’m not kidding.

Jimbo

Just when you thought it was all over!

Guardian – 7 November 2010
Chicago Mercantile Exchange starts offering rainfall futures and options
“As the Chicago Mercantile Exchange offers futures on rainfall, climate prediction is becoming big business worth $15bn”

What’s wrong with the local weather service? :o(

John Day

Note the peak at $7+ per share in late 2008, followed by a free fall to oblivion, with a small ‘hiccup’ on the way down. Are these signatures of some kind of “pump and dump” scheme?

Zeke

“Aaaaw, did someone loose ten trillion dollars today? Is someone sad?”
~Glenn Beck

nofate

Dennis Nikols, P. Geol. says: “Just don’t do it with my money…”
I think it’s too late Dennis:

“Professor Richard Sandor, of Northwestern University had started the business with $1.1 million in grants from the Chicago-based left-wing Joyce Foundation enthusiastically endorsed by Obama….Fortunately(!!!???) before its collapse Sandor was able to net $98.5 million for his 16.5% stake when CCX was sold.”

Poor guy only made 89.5 times his original investment. Fortunately he did not have to use his own money, he was able to use money from my pocket and yours and a few dozen of the other denizens of this blog, etc., etc.
Fortunately!!! You gotta love that word choice.

Retired Engineer

How much will we (taxpayers) have to bail out ICE? Are they “too big to fail”? Perhaps some “stimulus” needed, or a TARP?
Reagan said the closest thing to eternal life on earth is a government program. Perhaps CCX will become GCX? (worked for GM)
If Sandor got a grant to start this, doesn’t his profit belong to the grantor?
Seems like your basic get rich quick scam.

erik sloneker

@ John Day….that hiccup on the way down is what’s known as a “dead cat bounce”. Thankfully, the cat does truely appear to be dead. Let’s hope it dies as well for the rest of you folks across the ponds.

h.oldeboom

Little bit of topic; Al Gore is going to receive an environment award from the University of Tilburg (Netherlands). If you have never heard of this university, you are in good company because most of Dutch people either. It’s a so colled Alpha – university ; a formerly theological insitute – no physics, mathematics or things like that learned there.

Curiousgeorge

It’s not just the CCX that has gone belly up. It seems Ma Nature has got a beef with biofuels and has tossed a wrench into the biofuel industry in the form a virus that impacts the feedstocks – switchgrass in particular. It ain’t nice to fool Mother Nature.
http://www.dtnprogressivefarmer.com/dtnag/common/link.do;jsessionid=27F946D6ADB5CDBAF48D0AE806507477.agfreejvm2?symbolicName=/ag/blogs/template1&blogHandle=ethanol&blogEntryId=8a82c0bc2a8c8730012c2c8a748713d2&showCommentsOverride=false

Rhodrich

Incredible. Working in finance, I have a Bloomberg terminal up and running at all times. This has quotes for everything you could possibly wish to trade, and quite a comprehensive news system. The page for Chicago Climate Exchange is still up and running, as are the quotes for all their ‘financial instruments’ (all of which have a zero value.)
Is there anything on their news system that says anything about the exchange closing down? No!