NEW YORK, LONDON (November 18, 2021) — S&P Global Platts, the leading independent provider of information and benchmark prices for the commodities and energy markets, and Xpansiv, the global marketplace for ESG commodities, today announced an agreement to collaborate on the development and distribution of assessed daily closing prices for voluntary carbon market instruments. The agreement on international carbon accounting rules reached at COP26 provides a strong foundation to develop the collaboration.
The initiative will bring increased transparency, rigor, and integrity to the pricing of voluntary carbon market (VCM) assets, providing the market with greater confidence. It brings together Xpansiv's expertise as the global leader in trading physical carbon offsets with Platts' market-leading experience providing pricing transparency to the developing VCM markets.
"This partnership brings together all the necessary elements of a well-ordered market ecosystem—price transparency, liquid spot and futures markets, and robust market data," said John Melby, Xpansiv President and Chief Operating Officer. "It will enable the carbon market to further scale to accommodate demand and provide much-needed investment in high-quality carbon offset projects."
"The voluntary markets have the potential to play a pivotal role in helping close the gap between what governments can deliver and what the world needs to achieve in terms of overall emissions reductions," said Saugata Saha, President, S&P Global Platts. "The value of the market is now more than $1 billion and forecast to increase fifteen-fold by 2030, according to the Taskforce on Scaling Voluntary Carbon Markets. Our suite of VCM assessments is providing increased transparency and understanding of these markets, and this partnership with Xpansiv will enable us to develop scalable opportunities as this market continues to evolve."
Under the agreement, Xpansiv marketplace CBL—the world's largest exchange for spot-market trading of physical carbon offsets—will expand the data it makes available to Platts for the development and management of daily market price assessments. In addition, Platts and Xpansiv will collaborate with market participants to develop new types of price assessments and spot contracts to respond to rapidly evolving demand.
Xpansiv's XSignals business unit currently assesses daily closing prices used to settle the CBL Global Emissions Offset™ (GEO®) and Nature-Based Global Emissions Offset™ (N-GEO™) which underpin CME Group's futures contracts. As part of the collaboration, Platts will work with Xpansiv to establish the value of settlement prices, bringing its long track record of aligning with IOSCO objectives and principles to settling the value of carbon market prices.
S&P Global Platts launched the market's first daily voluntary carbon credit assessments with the publication of Platts CEC, representing CORSIA-eligible carbon credits which have surged by 944% since being launched in January 2021, with the value now pegged at $8.35/mt at the close on Nov. 12. Throughout this year, Platts has expanded its suite of VCM assessments to include Platts CNC, which reflects nature-based carbon credits as well as a variety of project types including removal, avoidance, renewable, and methane-collection credits.
In October, Xpansiv and Platts launched a new benchmark for methane performance in natural gas production to support the launch of Xpansiv's Methane Performance Certificate (MPC). The MPC enables natural gas producers to earn a premium for natural gas produced and transported with low methane emissions intensity.
For additional details on Platts price assessment methodology, see this subscriber note.
S&P Global Platts' parent, S&P Global, has an equity investment in Xpansiv through its S&P Global Ventures arm.
Xpansiv is the global marketplace for ESG-inclusive commodities. These Intelligent Commodities bring transparency and liquidity to markets, empowering participants to value energy, carbon, and water to meet the challenges of an information-rich, resource-constrained world. The company's main business units include CBL, the largest spot exchange for ESG commodities, including carbon, renewable energy certificates, and Digital Natural Gas™; H2OX, the leading spot exchange for water in Australia; XSignals, which provides end-of-day and historical market data; and EMA, the leading multi-registry portfolio management system for all ESG-inclusive commodities. Xpansiv is the digital nexus where ESG and price signals merge. Xpansiv.com
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