How the Chicago Climate Exchange Works: Author’s Note

When I learned there was such a thing as the Chicago Climate Exchange (CCX) I immediately wanted to know more about the idea. There was a lot of information to read and distill before writing this piece: Who is eligible? How does trading work? What about verification and transaction reporting?

The CCX launched in 2003 as the world's first greenhouse gas emission reduction program, allowing members to buy, sell and trade allowances and offsets in the form of carbon financial instruments (CFIs) -- one CFI represents 100 metric tons of carbon dioxide equivalent. The program is voluntary, but it's legally binding.

Sources

  • Chicago Climate Exchange http://www.chicagoclimatex.com/
  • Energy Quest, The California Energy Commission. "The Energy Story - Chapter 8: Fossil Fuels -- Coal, Oil and Natural Gas." http://www.energyquest.ca.gov/story/chapter08.html
  • Financial Industry Regulatory Authority (FINRA). http://www.finra.org/
  • Kennedy, Simon. "'Carbon trading' enriches the world's energy desks." MarketWatch. 2007. http://www.marketwatch.com/news/story/energy-desks-betting-big-future/story.aspx?guid= {D81A7B6C-E9F7-4896-B704-75881E5D2392}
  • Lieberman, Ben. "Beware of Cap and Trade Climate Bills." The Heritage Foundation. 2007. http://www.heritage.org/Research/Economy/wm1723.cfm
  • "Q&A: The Kyoto Protocol." BBC News. 2005. http://news.bbc.co.uk/2/hi/science/nature/4269921.stm
  • Ritter, Mario. "Carbon Trading: How the Chicago Climate Exchange Works." Voice of America. 2006. http://www.voanews.com/specialenglish/archive/2006-05/2006-05-30-voa2.cfm?CFID= 64810398&CFTOKEN=19400130
  • "The Chicago Climate Exchange." The Economist. 2002. ht­tp://www.economist.com/displayStory.cfm?Story_ID=1392773
  • United Nations Framework Convention on Climate Change (UNFCCC). "Kyoto Protocol." http://unfccc.int/kyoto_protocol/items/2830.php
  • United States Environmental Protection Agency. "Cap and Trade." 2008. http://www.epa.gov/airmarkt/cap-trade/index.html
  • "What is CO2e?" Townsville State of Environment Report. Townsville, Queensland, Australia. http://www.soe-townsville.org/sml_windows/co2e.html
  • World Business Council for Sustainable Development. "Persistence starts to pay off for Chicago emissions market." 2006. http://www.wbcsd.org/plugins/DocSearch/details.asp?type=DocDet&ObjectId=MTkyMDM
  • Zakaria, Fareed. "How to Blow Less Smoke." Newsweek. 2008. http://www.newsweek.com/id/157550?tid=relatedcl