Energy brokers' association launches secondary CER index

<(pointcarbon, Oslo)strong>A UK-based brokers’ group announced Thursday it will launch a new index for trades of certified emissions reductions (CERs) starting 3 December to make pricing more transparent in the secondary market for the credits.

The London Energy Brokers’ Association (Leba) will publish its benchmark CER index daily at 18:00 GMT. Trading hours will be between 07:00 and 17:00 GMT.
The index will take a volume-weighted average of CER trades conducted by Leba’s seven brokers for physical delivery on the first day of December between 2008 and 2012, in addition to the Dec08-Dec12 strip.

Leba’s member brokerages are: CantorCO2e, Evolution Markets, GFI Brokers, ICAP Energy, Spectron Group, Tradition Financial Services and Tullett Prebon Energy.

“This index shows the status and growing importance of the clean development mechanism (CDM) and Leba believes that the establishment of a recognised pricing mechanism contributes to the integrity and functionality of the market and its future role in the management of climate change,” said David Clark, Leba’s chairman.

CERs are the credits generated by emission reduction projects under the CDM, which countries that have carbon reduction targets under the Kyoto protocol can use for compliance.

In order to set the index, a minimum volume of 1,000 tonnes will need to be traded in each product, according to Leba.

Washington DC