The Brazilian Securities, Commodities and Futures Exchange – BM&FBOVESPA will hold on December 22 the first voluntary carbon credit market auction. A total amount of 240,000 voluntary carbon units from projects managed by the Social Carbon Company will be auctioned.
The emission reductions were generated from 11 renewable biomass projects administered by the Social Carbon Company in porcelain factories. These plants are located in the Brazilian states of São Paulo (Panorama, Presidente Epitácio, Paulicéia), Pará (São Miguel do Guamá), Pernambuco (Lajedo, Paudalho), Sergipe (Itabaiana), Minas Gerais (Ituiutaba), and Rio de Janeiro (Itaboraí). The projects reduce gas emissions by substituting gasoline for renewable biomass fuels like sugarcane bagasse, açai seeds, and rice husks, among others. The carbon credits have been validated by certified entities authorized by the United Nations Framework Convention on Climate Change (UNFCCC).
The auction will be held in four sessions, with a lot traded per session. The initial bidding prices will be indicated by lots that vary in accordance to the vintages and are priced at BRL 8.00 to BRL 14.00 per unit. The first transaction will occur at 1 p.m. (Brazil Time) and will be carried out by BM&FBOVESPA’s Carbon Credit Trading System. The financial settlement will be coordinated by Liquidez DTVM brokerage house.
BM&FBOVESPA’s Carbon Credit Market
The Brazilian Exchange has previously organized two carbon credit auctions in 2007 and 2008. Both auctions offered Certified Emissions Reductions (CERs), held by the São Paulo Municipal Government, and generated by the Bandeirantes and São João landfill projects.
The objective of BM&FBOVESPA’s carbon market is to foment carbon credit trading in Brazil within an organized trading environment. It also provides Brazilian companies an opportunity to sell their GHG emission reduction projects in the country. The Exchange’s trading platform offers global participants a secure, transparent, and efficient trading atmosphere with competitive prices.
