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October 6, 2020 | less than a minute read

Price discovery in the voluntary carbon market

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Kerry Liebenberg

Counsel

Get in touch

Kerry Liebenberg

Counsel

The lack of reliable, transparent price discovery in the voluntary carbon market has been a hindrance to the market, increasing transaction costs and limiting participation. The announcement of a global emissions offset contract by XCHG's CBL Markets exchange is certainly a step in the right direction. Time will tell how widely the contract is adopted, and of course the devil will be in the detail of the contract specifications. Not all voluntary carbon credits are created equally!

Commodity marketplace provider Xpansiv CBL Holding Group (XCHG) announced today that the first trade of its recently introduced Global Emissions Offset (GEO) contract on XCHG’s CBL Markets exchange. The new GEO is designed to enable the market to effectively set a price on carbon based on real-time transactions of carefully vetted offset projects, based on parameters defined by the International Civil Aviation Organization (ICAO) for CORSIA—the Carbon Offsetting and Reduction Scheme for International Aviation. The GEO is aimed at scaling the global voluntary carbon market, by standardizing and streamlining the purchase of offsets