Climate Impact X to roll out carbon credit price data with launch of spot exchange
Wong Pei Ting
TEMASEK-backed global carbon marketplace Climate Impact X (CIX) on Thursday (May 11) said it will launch a suite of price assessments in parallel with its upcoming spot trading platform, which is set to go live before July.
It said the new pricing intelligence is meant to cater to growing demands from market participants for more transparent and market-representative benchmarks of carbon credits.
CIX’s pricing director Julien Hall added: “The global voluntary carbon market is still nascent, which makes the availability of credible price signals crucial for efficient market building.”
Through the combination of its spot exchange’s transactions and firm orders alongside external market data, the pricing intelligence, which will distribute spot market assessments daily, is aimed at raising price transparency by building robust reference prices, he said.
“Greater trust and transparency will help to reduce the asymmetry of market information and improve the predictability of carbon trading and investment decisions,” he added.
For a start, the price assessments will track the value of credits that support Reducing Emissions from Deforestation and Forest Degradation (Redd+), a framework created by parties to the United Nations Framework Convention on Climate Change, it pointed out.
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Projects under Redd+ guide activities in the forest sector, and channel finance towards the conservation and sustainable management of forests, as well as the enhancement of forest carbon stocks.
CIX said the assessments will cover a range of price differentials for various credit vintages and for Nature X, which is set to be the first standardised contracts to be traded on its spot exchange. Vintage refers to the year the credits were issued.
When introducing Nature X in March, CIX had said its goal was to deliver a daily global pricing benchmark that is more tightly representative of the market value of leading nature-based projects, specifically for vintages of 2019 to 2022.
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The contracts would do so by drawing only from a heavily curated basket of 11 carbon projects that do not feature characteristics which “adversely affect their tradability, broad-market acceptability or price”, it had said.
Meanwhile, CIX said it is currently seeking alignment with the principles of the International Organisation of Securities Commission for commodity price benchmarks, which are a detailed set of guidelines relating to governance and control systems.
The company is aiming for its published price assessments to adhere to these principles from the very first day of publication, it said, adding that an independent auditor has been engaged to conduct a limited assurance review in the weeks following launch.
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