Climate Impact X reposted this
We’re very proud at Climate Impact X (CIX) to have launched our CORSIA spot price benchmarks last Thursday, which we think, perhaps for the first time, depict the true value of these credits. CIX daily assessments represent the daily spot trading value for immediate delivery of CORSIA Eligible Emissions Units as defined by the International Civil Aviation Authority (ICAO). Our last assessment was USD26/mt on Friday 14th June (Monday was a national holiday in Singapore!). Here is why we think our price benchmarks are the best representation of CORSIA credits: 1️⃣ They represent the spot value of credits today 𝐟𝐨𝐫 𝐢𝐦𝐦𝐞𝐝𝐢𝐚𝐭𝐞 𝐝𝐞𝐥𝐢𝐯𝐞𝐫𝐲, not for future delivery. This is important as what qualifies for CORSIA can regularly change with new guidance from the ICAO’S Technical Advisory Body (TAB). The next TAB Council Session is in Oct-Nov 2024. As such, physically-delivered futures, which in carbon have so far tended to coalesce around December each year, are inherently speculative on the outcome of TAB meetings, while assessments reflecting deliveries sometime this year or at the end of the year also risk being unnecessarily clouded by that uncertainty. A spot price benchmark for immediate delivery will deal with these regular specification changes and provides the basis for better-designed risk management tools and derivatives. 2️⃣ Our benchmarks are “𝐬𝐜𝐫𝐞𝐞𝐧-𝐚𝐬𝐬𝐢𝐬𝐭𝐞𝐝,” prioritizing transactions, bids and offered in the open market on CIX Exchange, which are bona fide firm, pre-funded, executable orders. Today only one project globally has credits in circulation which qualify as CORSIA Eligible Emission Units: Guyana’s project 102 on ART Trees, and these can be offered or bid on our screen. Exchanges create the opportunity for enhanced transparency and direct and open participation in price formation by all professional actors. While screen-based trading activity in the VCM is limited today, it brings substantial advantages and hopefully will grow. 3️⃣ In determining the specific credits qualifying for use in the assessments, CIX 𝐬𝐭𝐫𝐢𝐜𝐭𝐥𝐲 𝐫𝐞𝐟𝐞𝐫𝐬 𝐭𝐨 𝐨𝐟𝐟𝐢𝐜𝐢𝐚𝐥 𝐠𝐮𝐢𝐝𝐚𝐧𝐜𝐞 𝐟𝐫𝐨𝐦 𝐈𝐂𝐀𝐎, without any additional arbitrary restriction, for example of approved registries. As CORSIA specifications evolve, the assessment will update in accordance with the latest specification to always reflect the purest, qualifying spot value of a CORSIA Eligible Emissions Unit. As with all major CIX benchmarks, these two assessments will be externally audited for alignment against the IOSCO Principles for commodity price benchmarks. For more details, including signing up to our daily report or to read our full benchmark methodology please visit https://lnkd.in/exEAQmAw. #corsia #voluntarycarbonmarket #vcm #aviation #icao
Carbon- Solution- Origination-Exchange & Clear, OTC Trading
2moGreat work Julien by you and your team! This will CORSIA benchmarks will have a significant role to play in the VCM space.