Record Volume of Environmental Contracts Traded on ICE in 2021 Equivalent to an Estimated $1 Trillion in Notional Value
January 11 2022 - 6:30AM
Business Wire
Intercontinental Exchange (NYSE:ICE), a leading global provider
of data, technology, and market infrastructure, today announced
that a record volume of environmental contracts traded in 2021. A
total of 18 billion tons of carbon allowances traded in 2021,
equivalent to an estimated $1 trillion in notional value and equal
to over half the world’s estimated total annual energy-related
emissions footprint.
Reflecting how companies use these markets to manage and price
climate risk, as well as meet compliance obligations, a record 19
million environmental futures and options contracts traded on ICE
in 2021. These traded contracts included a record 15.2 billion EU
carbon allowances, a record 2.4 billion California carbon
allowances, 346 million Regional Greenhouse Gas Initiative
allowances and, following its launch in May 2021, 255 million U.K.
carbon allowances.
“For over a decade, ICE has provided the markets with the
ability to price the negative externality of emissions through
carbon allowance futures, and the positive externality of creating
carbon-free electricity through renewable energy certificate (REC)
futures,” said Gordon Bennett, Managing Director of Utility Markets
at ICE. “This year we will be expanding our carbon credit markets
to value and support the preservation of natural assets, as well as
launching our first carbon index futures contract to provide access
to the global cost of emissions in one instrument.”
In October 2021, ICE invested in LevelTen Energy, which brings
greater transparency and liquidity to the renewable energy industry
and enables participants to transact on power purchase agreements
and physical energy assets more efficiently. In addition, ICE plans
to expand its renewable energy futures markets with the launch of
six new U.S. REC futures on January 18, based on solar and wind
energy. U.S. REC markets are among the most liquid and transparent
green certificates available. Approximately 705,000 REC futures
traded on ICE in 2021, equivalent to an estimated 48 million
megawatt hours of renewable energy or enough to power around 4.5
million homes for a year.
“The widespread electrification of the energy system and a
transition to a cleaner grid will become key themes in meeting net
zero targets,” continued Gordon Bennett. “We are seeing significant
demand from corporate buyers who want to green their power
consumption through renewable power purchase agreements and
renewable energy certificates. REC futures markets will become
increasingly important to the process of efficiently allocating
capital to renewable electricity projects and managing the risks of
transitioning to a cleaner electricity grid.”
ICE plans to launch its first financially settled global carbon
futures contract (ICE: CO2) based on the ICE Global Carbon Futures
Index on January 31, 2022. In addition, ICE is working to launch
several initiatives in 2022 to further support the development of
carbon credit markets globally. This includes launching ICE’s first
Nature-Based Solutions futures contract, subject to regulatory
approval; its first carbon credit auctions for Permian Global, a
developer of large-scale tropical forest protection and restoration
projects; and forming the ICE Carbon Oversight Committee to provide
independent governance and oversight of ICE’s activities in the
voluntary carbon markets.
ICE offers customers access to the largest and most liquid
environmental markets in the world to price climate risk. For more
information on how to trade and clear these markets please visit
https://www.theice.com/energy/environmental, read our FAQs, or
contact sales-utilities@ice.com.
About Intercontinental Exchange
Intercontinental Exchange, Inc. (NYSE: ICE) is a Fortune 500
company that designs, builds and operates digital networks to
connect people to opportunity. We provide financial technology and
data services across major asset classes that offer our customers
access to mission-critical workflow tools that increase
transparency and operational efficiencies. We operate exchanges,
including the New York Stock Exchange, and clearing houses that
help people invest, raise capital and manage risk across multiple
asset classes. Our comprehensive fixed income data services and
execution capabilities provide information, analytics and platforms
that help our customers capitalize on opportunities and operate
more efficiently. At ICE Mortgage Technology, we are transforming
and digitizing the U.S. residential mortgage process, from consumer
engagement through loan registration. Together, we transform,
streamline and automate industries to connect our customers to
opportunity.
Trademarks of ICE and/or its affiliates include Intercontinental
Exchange, ICE, ICE block design, NYSE and New York Stock Exchange.
Information regarding additional trademarks and intellectual
property rights of Intercontinental Exchange, Inc. and/or its
affiliates is located here. Key Information Documents for certain
products covered by the EU Packaged Retail and Insurance-based
Investment Products Regulation can be accessed on the relevant
exchange website under the heading “Key Information Documents
(KIDS).”
Safe Harbor Statement under the Private Securities Litigation
Reform Act of 1995 -- Statements in this press release regarding
ICE's business that are not historical facts are "forward-looking
statements" that involve risks and uncertainties. For a discussion
of additional risks and uncertainties, which could cause actual
results to differ from those contained in the forward-looking
statements, see ICE's Securities and Exchange Commission (SEC)
filings, including, but not limited to, the risk factors in ICE's
Annual Report on Form 10-K for the year ended December 31, 2020, as
filed with the SEC on February 4, 2021.
ICE- CORP
Source: Intercontinental Exchange
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ICE Media Contact: Rebecca Mitchell
Rebecca.Mitchell@ice.com +44 7951 057 351 ICE Investor
Contact: Mary Caroline O’Neal marycaroline.oneal@ice.com (770)
738-2151
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