The European Climate Exchange (ECX) expects to launch a contract on March 14 to trade certified emissions reductions (CERs) under the Kyoto Protocol on global warming, its chief executive Patrick Birley said.

"It will be announced today," Birley told Reuters on Tuesday on the sidelines of a carbon market conference in London, organised by the Institute of Economic Affairs.

The decision follows the resolution of a dispute last week with the London Clearing House, LCH.Clearnet, regarding contract settlement procedures.

ECX's parent company, Climate Exchange said last week it was launching the contract imminently.

Rich countries can meet their greenhouse gas emissions targets under the Kyoto Protocol by funding emissions cuts in developing countries, through a currency of carbon offsets called CERs.

Since 2005 the European Union has run a separate but linked carbon market whereby energy-intensive companies have to buy carbon emissions permits called EU allowances (EUAs) above a certain emissions quota.

EUAs already trade on the ECX and Birley cited estimates that there was a CER pipeline of over 4 billion tonnes through 2012 compared with an EUA quota of 2.1 billion tonnes of EUAs.

The CER market is taking off only now because of uncertainties regarding actual generation and delivery of emissions cuts, and because countries can only use them to count against their national emissions from 2008-12.

The New York Mercantile Exchange said on Monday it would launch trading of CER contracts on March 17.

"The fact more and more exchanges are coming into this space is positive," ECX's Birley said on Tuesday.

    Source:Reuters

    2008-2-28