isramart news: Bluenext in China carbon venture

Bluenext, Europe’s largest carbon credit exchange, is planning to set up a joint venture with China Beijing Environmental Exchange, in a sign that foreign players are positioning themselves for a fight over running secondary carbon trading in China once Beijing allows the launch of such a market.

“We are aiming at launching a joint venture, which would also direct us to other countries, not only to China,” Serge Harry, Bluenext chief executive, told the Financial Times.

“With CBEEX to launch a market in China in the near future, we have to start somewhere,” said Philippe Chauvancy, sales director. “We have the network and the resources to be involved in the launch of the market in China.”

Bluenext, jointly owned by NYSE Euronext and Caisse des Dépôts, the French state-owned bank, and CBEEX set the cornerstone for an international trading platform for Chinese carbon emission credits yesterday with an agreement to offer information on Chinese emissionreducing projects to potential foreign investors on Bluenext’s website. The two exchanges also plan to launch a number of new products that are still under regulatory review in China, Mr Harry said. He declined to provide details. In Europe, Bluenext’s products (apart from carbon spot trading) include carbon futures and spreads, which allow investors to arbitrage. The exchange has also announced indices and exchange-traded funds.

The agreement comes ahead of a Copenhagen meeting in December which is due to decide on a successor to the Kyoto protocol, whose main provisions expire in 2012.

Mr Chauvancy said recent climate change talks between Washington and Beijing had brought hopes that the Copenhagen meeting could kickstart secondary carbon markets involving the US and China, the two largest CO 2 emitters, on a large scale.

The Chicago Climate Exchange, owned by Climate Exchange PLC, has teamed up with China National Petroleum Corp, to set up the Tianjin Climate Exchange.

Mr Harry said other foreign carbon exchanges were also in talks for China partnerships.