The volatility seen in the carbon markets recently is unprecedented with wild swings up and down.

The CBL Nature-based Carbon price had a record drop Tuesday, triggered by the threat of a western economic recession stemming from the Russian invasion and sanctions.

The Nature-Based carbon price GEO dropped over 16% to $9.68 – which is lower than it was ahead of the COP26 conference back in November 2021.

That’s is a record decline for the GEO in its relatively short history.

Going the other way, another record was set when the European Carbon price had its largest 1-day price gain in history.

The price spiked up over 17% on Tuesday, this follows a massive 30% decline that started with the Russian invasion of Ukraine.

The modern carbon market is still in its infancy and carbon is coming second to energy.

Higher energy costs could lead to less travel, both for work and pleasure.

Even some airlines have begun to cancel flights due to fuel cost concerns.

It could be a real bumpy ride for a bit as the global economy has never really had to include carbon into the equation until now.

But the NetZero and decarbonization movement will march forward.

The post The Wild Carbon Markets appeared first on Carbon Credits.

To meet net-zero objectives, companies across the globe are investing heavily in carbon offsets.

The carbon offset industry has boomed over the past year. In fact, the Voluntary Carbon Market (VCM) is now valued at over $1 billion. That’s up from just $300 million in 2018. And many experts believe it has the potential to reach $100 billion by 2030.

J.P. Morgan and Marc Benioff’s TIME Ventures seem to agree.

They took part in a Series-B led by Energize Ventures to support NCX – which raised $50 million.

What are carbon offsets, and why are they so popular?

Carbon offsets are tools that companies can use to “neutralize” their carbon emissions. This is done through various environmental projects.

Simply put, one carbon offset equals one metric ton of carbon.

NCX is a carbon marketplace that companies can use to find and purchase these carbon offsets.

First, NCX uses satellite images and machine-learning software to map forest areas. Once mapped, NCX serves as a go-between for companies and landowners to agree.

Suppose the landowners choose to refrain from cutting down their trees (for compensation). In that case, companies can claim those “offsets” against their own carbon emissions. It’s mutually beneficial – landowners are compensated, and companies can meet emissions goals.

So, if a landowner promises to keep trees intact, and a company pays them to do so, the company is doing something beneficial for the environment.

Note that many of these companies are working towards net-zero emissions. However, the technology to drastically reduce emissions or remove them altogether isn’t quite where it needs to be. So, offsets serve a purpose interim.

NCX then takes a percentage of the purchase price.

NCX was formally known as SilviaTerra. It was founded in 2010 by two students who met studying forestry at Yale.

To date, NCX has raised $75 million.

The post Carbon Marketplace NCX raises $50M appeared first on Carbon Credits.

Xpansiv is planning an IPO on the Australian Stock Exchange later this year. But right now they are in full M&A mode.

They are cashed up and have started making acquisitions in a massive roll-up play in the carbon markets.

Xpansiv’s trading platform currently hosts over 90% of all voluntary carbon credit transactions globally.

In 2021, Xpansiv recorded $305 million in revenue (~300% higher than the prior-year).

Over 120 million tonnes of carbon were traded on its CBL Exchange last year (a 4x increase over 2020.)

Their platform is used by the largest corporations such as Walmart, Tesla, Chevron, Shell, and Goldman Sachs.

The platform matches companies needing to buy credits (to fulfill their net-zero objectives) and speculators/investors with carbon credit providers.

They recently teased a potential vertical integration acquisition called the “Moonraker” project in their latest investor pitch deck. The transaction is expected to be worth over $100 million.

They also recently announced to acquire a leading provider of registry infrastructure for energy and environmental markets – APX Inc.

Xpansiv had two $100 million funding rounds in the past 2 years and also a $40 million pre-IPO deal.

They are expected to raise more than $500 million in the coming weeks – placing them at a ~$2 Billion market cap ahead of them being publicly traded.

As more and more companies make NetZero pledges, the amount of capital being deployed in the carbon sector is growing every quarter.

Xpansiv CEO, Joe Madden has stated that “it was clear that there were trillions of dollars in mismatch there, and somehow that would have to get reconciled. And markets were where it was going to get reconciled.”

The post Xpansiv Expansion Ahead of IPO appeared first on Carbon Credits.

Germany has placed a hold on the Nordstream 2 underground natural gas pipeline, which runs between Germany and Russia. The channel is almost complete and operable.

This move by Germany will not impact the immediate supply of natural gas. However, it could affect Europe’s already strained natural gas resources – and impact carbon markets.

Natural gas and oil prices have increased.

Fears that Russia will withhold future natural gas have driven prices up to $90 per megawatt-hour. That’s an increase of 10%.

The price of oil – also a Russian export to Europe – rose 1.5% ($99.50 per barrel). This is the highest level Europe has seen since 2014.

U.S. natural gas prices also increased, though less than in Europe.

Luke Oliver, Managing Director and Head of Strategy at KraneShares, told ETF trends, “Halting certification of the Nordstream2 gas pipeline will put increasing pressure on natural gas prices, which in turn make fuel switching from coal to gas more expensive and increases demand for carbon allowances.”

Simply put, if the price of switching from coal to gas is higher, the demand on carbon markets may increase even more.

Oliver went on to say, “This puts pressure on the entire energy complex. This is no doubt positive for a carbon price, albeit sadly not necessarily positive for emission reductions.”

Per Oliver, “2022 has been an interesting year already for carbon markets. With new proposals around upper price band triggers, we’ve seen some volatility; however, our modeling would suggest that even IF the proposal was adopted, it wouldn’t meaningfully limit upside potential.”

Only time will tell how this will impact the energy sector and carbon markets.

Regardless of what will be, one thing is for sure: we all hope for peace in the region.  

The post Could Carbon Markets Be Impacted Due to European Pipeline Freeze? appeared first on Carbon Credits.