Paula DiPerna

CCX—A Network of Early Adoptors,

and precursor to a global system
2003-2010

Presented at B20 Side Event with

ICDX, 25th May 2022
Chicago Climate Exchange, Inc.
 Voluntary but Legally Binding Reduction
Schedule

Phase I (2003-2006):
01 Members made legally binding
commitments to reduce/trade
to 4% below baseline by 2006

Phase II (2007-2010):
02 Members make legally binding
commitment to reduce/trade
to 6% below baseline by 2010

** Baseline: Average emissions from years 1998-2001

(Phase I), emissions from year 2000 (Phase II)

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 GREENHOUSE GASES COVERED BY CCX
Gases Included: Emissions of the following
six GHGs from facilities owned by CCX
Members are covered, as applicable:

1. Carbon Dioxide (CO2)

2. Methane (CH4)
3. Nitrous oxide (N2O)
4. Hydrofluorocarbons (HFCs)
5. Perfluorocarbons (PFCs)
6. Sulfur Hexafluoride (SF6)

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 Types of CCX Membership
Members
● Direct GHG Emissions
● Commit to reduce to 6% below baseline by 2010

Offset Providers
● Offset Providers: Register and sell Offsets on its own behalf.
● Offset Aggregators: Serve as the administrative representative of multiple Offset-
generating projects

Associate Members
● Office-based businesses or institutions with negligible direct GHG emissions
● Commit to report and fully offset 100% of indirect emissions

Liquidity Providers
● Entities or individuals that trade on CCX for purposes other than compliance
● Examples: market makers and proprietary trading groups

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 CCX Members - Sample

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 CCX Size Relative to National GHG Trading Coverage
CCX includes more industrial emissions under its legally binding
cap than any single country in the world

[Included emissions]

[RGGI] Source: EU ETS Phase II National Allocation Plans

[AB32]

CCX Member-wide emissions are equivalent to:

15% of U.S. stationary emission sources
25% of emissions covered under EU ETS
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 Reduction vs. Offsets

Offset GHG
Reduce
GHG
GHG

GHG

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 Chicago Climate Futures
Exchange (CCFE)
➔ CFTC Designated Contract Market
➔ Central Clearing provided by Clearing Corp.
➔ Market Surveillance provided by the National Futures Association (NFA)

Selection of CCFE Environmental

Products
➔ Carbon Financial Instrument (CFI) Futures and Options
➔ CFI-US Futures and Options
➔ Regional Greenhouse Gas Initiative (RGGI) Futures and Options
➔ California Climate Action Reserve Futures and Options
➔ U.S. EPA Sulfur Financial Instrument (SFI) Futures and Options
➔ U.S. EPA Nitrogen Financial Instrument – CAIR Annual (NFI-A) Futures and
Options
➔ ECO-Clean Energy Index (ECO-Index) Futures
➔ IFEX U.S. Wind Event Linked (IFEX-ELF) Futures

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 Precursor To A Global
System
➔ Affiliate exchanges in Europe (ECX)
➔ Joint ventures explored in Canada,
Australia
➔ Established China’s first carbon pilot, TCX,
with PetroChina-CNPC
➔ Conducted demo linkage between CCX and
EU ETS
➔ Members worldwide, e.g. Melbourne

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 Why Did
Companies Join?
● Identify hidden risks and
opportunities
● Prepare for expected regulation
● Expand commodities trading
benefits Learn by doing about
carbon value
● Contribute to national policy
objectives
● Respond to consumer preferences
● Be a leader and in the vanguard

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Tianjin Climate Exchange – Opening Ceremony
CNPC CFO, Mr. Wang Guo Liang, on the
importance of emissions trading in China

“The establishment of the Exchange marks a new stage

in the development of emission
rights trading in China and has profound significance in
promoting China to fully
establish an emission rights trading system and a
long-term mechanism for energy
conservation and emission reduction; to also speed up
economic development and build a
society that conserves resources and is environmentally
friendly. CNPC has attached great
importance on the preparation for the establishment of
Tianjin Climate Exchange.”

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 CCX® and Members in the Press

CARBON KING
Economist Strikes Gold
In Climate-Change Fight

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Thank You