A carbon-credit transaction network developed by nine banks including Canadian Imperial Bank of Commerce and UBS Group is a step closer to launching early next year after completing a series of pilot trades.
Demand for carbon credits may grow more than fortyfold over the next three decades, according to BloombergNEF projections, as companies use them to deliver on commitments to reach net-zero carbon emissions by 2050.
But the business of trading environmental credits has also been tainted by companies' use of low-quality carbon offsets to justify claims of carbon neutrality. Carbonplace will only settle trades of credits that are included in widely recognized registries of those assets, such as Verra or American Carbon Registry, said Robin Green, its chief product officer.
Carbonplace's member banks, which also include Natwest Group, Itaú Unibanco and National Australia Bank, started it with the goal of making the process easier for clients who want to buy or sell carbon credits.
"Think of it like eBay," Green said in an interview. "We are just broadening the access to the market by providing transparency and trust. It's not that you can't buy credits right now, but we are really simplifying the process."
Green, based in London, is a CIBC employee who's been seconded to Carbonplace.
The pilot trades on the blockchain-based network included the sale of carbon credits from Melbourne-based
