Nodal Exchange and IncubEx have announced plans to launch several new environmental futures contracts, pending regulatory approval. These contracts are set to be listed on September 17, 2024, and include the following:
- Alberta TIER Emission Performance Credits
- M-RETS CRS-Listed Canadian Sited Wind RECs (Front and Back Half)
- ERCOT Reporting Year CRS-Listed Wind RECs
- NAR Wind RECs
- M-RETS Wind RECs
- ERCOT Wind RECs
- California Book and Claim RECs
The Alberta Technology Innovation and Emissions Reduction (TIER) Emission Performance Credits (EPC) futures contract will offer physical delivery of credits issued to entities based on their emissions performance during a compliance period.
Additionally, Nodal plans to introduce a new set of wind Renewable Energy Certificate (REC) futures. These will complement its existing portfolio, offering further risk management tools for renewable energy producers and consumers. The new contracts will be sourced from established REC registries, including the ERCOT Renewables Registry, North American Renewables Registry (NAR), and Midwest Renewable Energy Tracking System (M-RETS). The expanded REC futures portfolio will provide market participants with more options for managing exposure in the renewable energy space.
The California Book and Claim RECs will enable physical delivery of RECs eligible for compliance under the Low Carbon Fuel Standard (LCFS), when matched and retired following the zero-carbon intensity pathway. This contract builds on Nodal’s extensive suite of California-based environmental offerings, such as California Carbon Allowances (CCAs), California Carbon Offsets (CCOs), and California LCFS.
As of August 30, 2024, open interest in environmental futures and options on Nodal, including carbon, RECs, and renewable fuel credits, reached an all-time high of 380,647 contracts.
“Nodal and IncubEx have worked diligently to build the world’s most comprehensive suite of environmental products,” said Paul Cusenza, Chairman and CEO of Nodal Exchange. “Our continued growth in volume and open interest demonstrates our commitment to meeting the evolving needs of the market.”
Dan Scarbrough, President and COO of IncubEx, added, “These new contracts are based on feedback from the growing community of environmental traders and brokers on Nodal Exchange. They offer first-of-their-kind hedging solutions, expanding our robust environmental product suite, which has seen significant growth since 2018.”
Nodal Exchange now offers over 120 environmental futures and options, representing the largest such offering on any exchange.
About Nodal Exchange
Nodal Exchange is a leading derivatives exchange providing price, credit, and liquidity risk management for North American commodities markets. It is known for its innovative solutions, including the world’s largest set of electric power locational futures contracts and environmental contracts. Nodal Exchange, part of the EEX Group, offers over 1,000 contracts across numerous unique locations. All Nodal Exchange contracts are cleared by Nodal Clear, a CFTC-registered derivatives clearing organization.
About IncubEx
IncubEx specializes in developing products, services, and technology solutions for global environmental markets. Working closely with Nodal Exchange and European Energy Exchange (EEX), IncubEx creates new financial markets and trading solutions for environmental and climate-related commodities. Founded in 2016, with offices in Chicago and London, IncubEx is led by former executives from Climate Exchange and is dedicated to capturing opportunities in environmental markets globally.
For more information, visit IncubEx’s website.
