CME ready for green derivatives push

CHICAGO (Reuters) – CME Group, the world’s largest derivatives exchange, is gearing up for a U.S. cap-and-trade carbon policy that could mean a boom in “green” futures and options trade, a top CME official said on Monday.

“We’re positioned to take advantage of that should the energy policy and energy legislation go in the way of a tradable emissions and credit market,” CME Chief Executive Craig Donohue told the Reuters Exchanges and Trading Summit in New York in a telephone interview.

Expanded trading of green products is likely if the United States adopts a cap-and-trade policy that would limit the amount of greenhouse gases like carbon dioxide that industries can emit. Man-made greenhouse gases are cited by most scientists and the Obama administration as a key reason behind rising global warming trends and effects.

A current cap-and-trade proposal in Congress, introduced by U.S. Representatives Henry Waxman and Edward Markey, would cap carbon emissions and require industry to “offset” every ton of carbon dioxide emissions with tradable carbon credits.

Reuters