Carbon trading

An airless netherworld that hovers uncomfortably between financial instruments — it isn’t those, because there is no credit component — crypto — it isn’t that because it’s government sponsored and doesn’t rely on breathless credulity about computer programming — and commodities — it isn’t that because you can’t eat, burn, or build a bridge out of carbon certificates.

EU Emissions Allowance Transaction Annex to the 2005 ISDA Commodity Definitions →Go uptown Top Trumps®Financial Weapons of Mass Destruction® Emissions Allowance “Wanna stop frying the planet? Start here. Will it help? Who knows? The forward curve is in contango: who cares!” Docs Take your pick: IETA, ISDA or even EFET: none of them good. But at least you have flexibility in mediocrity 4 Amendability Nope. The EU can amend them, but you can’t. 0 Collateral They aren’t anyone’s obligations as such. In fact, they’re more like a sort of unofficial, made up, (hush) crypto. No credit risk! DNA Transferability With an account at the Union Registry, sure! 7 Leverage Not unless you do a CEmO, and we just made that up. 0 Fright-o-meter Not directly scary as long as there is an EU with Greta Thundberg in it, but global warming is going to lead to Armageddon so, you know, indirectly. 5 Index: Click ᐅ to expand: ISDA Emissions TOC EUA Annex - Premium Emissions Pro tip: for tons of information about EU ETS and EU financial services regulation see Michał Głowacki’s magnificent emissions-euets.com website. Emissions trading documentation ISDA: EU Anatomy • EU Wikitext • EU Nutshell (premium) • UK Anatomy • UK Wikitext (to be merged into EU Anatomy) IETA: IETA Master Agreement • IETA Wikitext • IETA Nutshell (premium) EFET: EFET Allowances Appendix • EFET Allowances Wikitext • EFET Nutshell (premium) Tell me more Sign up for our newsletter — or just get in touch: for ½ a weekly 🍺 you get to consult JC. Ask about it here.

See also

• Emissions Anatomy