Chicago Climate Futures Exchange

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Chicago Climate Futures Exchange
CCXNewLogo.gif
Headquarters Chicago
Key People Satish Nandapurkar, president and CEO
Products CCFE is a regulated futures exchange for U.S. CO2, SO2 and NOx allowances.
Website http://www.ccfe.com/

The Chicago Climate Futures Exchange (CCFE) was a wholly owned subsidiary of the Chicago Climate Exchange (CCX), the world's first environmental derivatives exchange. (CCFE) was a Commodity Futures Trading Commission-regulated futures exchange for U.S. CO2, SO2 and NOx allowances. It was approved by the Commodity Futures Trading Commission (CFTC) as a contract market in 2004.[1]

Intercontinental Exchange Inc. (ICE) bought the parent company, Climate Exchange Plc, in 2010 for about $581 million. On August 5, 2011, ICE announced it would shut down the Chicago Climate Futures Exchange at the end of 2012’s first quarter, partly because of the failure of the U.S. to pass “cap-and-trade” legislation to help limit carbon emissions.[2] Effective as of February 28, 2012 there is no remaining open interest in contracts at CCFE and all contracts have been delisted.[3]

Clearing services for the CCFE were provided by The Clearing Corporation. Market surveillance services were provided by the National Futures Association (NFA), the industry-wide, self-regulatory organization for the U.S. futures industry.[4]

Products

The CCFE listed the following products: Sulfur Financial Instrument Futures and Options, European Carbon Financial Instrument Futures, Carbon Financial Instrument Futures and Options, Certified Emission Reduction Futures and Options, ECO Clean Energy Index Futures, Nitrogen Financial Instrument - Ozone Season Futures, Nitrogen Financial Instrument (Annual Futures), IFEX Event Linked Futures.

On Nov. 19, 2008 CCFE’s launched its Carbon Financial Instrument - U.S. Allowance Futures (CFI-US), which offered the first contract for directly hedging exposure to possible future U.S. carbon allowance prices. [5] The contract allows traders and investors to take a position on the US carbon market with delivery in 2013 and beyond.

On Aug. 15, 2008, CCFE was the first exchange to offer trading on Regional Greenhouse Gas Initiative (RGGI) futures and options on futures. RGGI is a CO2 cap-and-trade emissions trading program comprised of ten New England and mid-Atlantic states that began in January 2009 and is the first government-mandated CO2 emissions trading program in the United States.[6]

In June of 2009, CCFE and World Steel Dynamics announced the formation of World Steel Exchange (WSE) to list futures contracts initially for steel scrap. The contracts would trade and clear on CCFE’s internetaccessible trading platform and would be based on the SteelBenchmarker family of price indices and other indices.[7] The WSE was expected to launch its first contracts later in 2009.[8]

On Aug. 11, 2009, CCFE announced the successful completion of the first-ever physical delivery of a Renewable Energy Certificate (REC) futures contract, which was completed on Aug. 5, 2009.[9]

CCFE Clearing Firms

History

References

  1. News: CFTC Approves Chicago Climate Futures Exchange. Sullivan & Cromwell LLP.
  2. ICE to shutter Chicago Climate Futures Exchange. Reuters.
  3. CCFE closure. CCFE.
  4. About CCFE. CCFE.
  5. Press Release. CCFE.
  6. CCFE first for REGGI contracts. Commodities Now.
  7. Press Release. Mondovisione.
  8. CCFE, World Steel Dynamics Form New Steel Exchange. Reuters.
  9. Press Release. CCFE.