The European Directive n°2003/87/CE confirms the EU’s determination in tackling the climate change issue by setting up an exchange system of greenhouse gas emissions allowances within its borders. The efficiency of the exchange system of allowances will be tested by the “price signal” produced by the market, on the basis of transactions that will actually be completed and registered. The confrontation of the supply and demand in a unique environment will insure the best possible liquidity.
In this context, the Caisse des Dépôts et Consignations, Euronext and Powernext have joined expertise in setting up an organised market for allowances or carbon emissions permits based on 4 crucial principles:
- the guarantee of transaction performance based on a secure and harmonised settlement-delivery mechanism avoiding payment defaults and CO2 quota delivery defaults
- the transparency of prices and their determination
- a non-discriminatory access to the market and the complete confidentiality of participants
- a straight through processing from transaction to delivery, open to all participants owning an account in one of the 25 CO2 emissions registries.
On 14 December 2004, the Caisse des Dépôts et Consignations, Euronext and Powernext signed a letter of intent setting up the basis of this partnership. This market –which procedures are being finalised – is planned to be launched in March 2005.
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