DuPont and Marubeni in UK emissions trading first

Toby Shelley / Financial Times 19sep01

US chemical company DuPont and Japanese trading house Marubeni have become the first parties to trade greenhouse gas emissions under the trading scheme finalised by the UK government last month.

DuPont, which manufactures in the UK, has sold allowances of 10,000 tonnes of carbon dioxide equivalent to Marubeni subsidiary Mieco, which can either trade them within the UK or wait for the government-certified allowances to be recognised abroad.

The UK scheme, which is backed by government cash incentives as part of the effort to meet greenhouse gas reduction targets, goes live in April, so the deal was necessarily a forward trade. The allowances cover emissions in 2002 that DuPont will forego.

Tim Atkinson at Natsource, which brokered the trade, said it was done within a bid-offer price range of £4 to £7 per tonne that has become established in the emerging UK market. He said there are signs that companies are beginning to look seriously at emissions trading as a way of meeting reduction targets, although at present there are bids from only a handful of companies for some 30,000 tonnes of CO2 equivalent.