ICE launches carbon-neutral U.S. electricity futures index

Rick Steves

“This index will assist us in developing financial instruments that provide investors exposure to exchange-traded electricity futures and carbon offsets, while having the ability to use the ICE U.S. Carbon Neutral Power Index as a benchmark.”

Intercontinental Exchange has launched the first carbon-neutral U.S. electricity futures index as the market focuses on the build-out of North American renewable generation and its impact on U.S. power prices.

The ICE U.S. Carbon Neutral Power Index provides investors with a benchmark that contains exposure to the critical North American power markets.

Broadly representative of U.S. electricity consumption and price

With the utilization of the six major U.S. power pools, the ICE U.S. Carbon Neutral Power Index will be broadly representative of U.S. electricity consumption and price.

The ICE U.S. Carbon Neutral Power Index consists of:

  • twelve months of ICE-listed electricity futures contracts from six major U.S. power pools
  • carbon allowance futures contracts designed to offset the emissions of the generation associated with these electricity futures contracts.

Electricity is the second largest energy component of the CPI

Varun Pawar, Vice President, Head of ICE Data Indices, said: “Electricity is the second largest energy component of the Consumer Price Index and is not directly included in any of the existing major commodity indices. This rules-based index developed by ICE with methodology licensed from Carbon Neutral Investment Company LLC (CNIC) has the ability to be a preferred financial instrument for investors who are looking for sustainable North American commodity exposure in their portfolios.”

Donald R. Sinclair, Chairman of CNIC, commented: “We are proud to have licensed our methodology as part of the ICE U.S. Carbon Neutral Power Index. This index will assist us in developing financial instruments that provide investors exposure to exchange-traded electricity futures and carbon offsets, while having the ability to use the ICE U.S. Carbon Neutral Power Index as a benchmark.”

ICE launched ESG Bond Index Family

Last year, Intercontinental Exchange launched a suite of corporate bond climate indices, part of the ICE ESG Bond Index Family, which supports the growing demand for responsible and sustainable investing.

Designed to capture the Paris Agreement goal of achieving net zero carbon emissions by 2050, the suite of corporate bond climate indices leverage 23 of ICE’s corporate bond benchmarks to create a family of 138 climate indices, many of which are labelled as Paris Aligned benchmarks and Climate Transition benchmarks.

For each benchmark index, ICE has created six climate variants using different screening and carbon metrics that all target a reduction in the aggregate carbon emissions of constituents to net zero by 2050.

ICE’s ESG bond indices leverages the existing benchmark such as the ICE BofA Fixed Income Indices, to create a broad range of benchmarks that match the growing demand for responsible and sustainable investing.

The fixed income sustainable benchmarks and ICE’s Global Carbon Futures Indices serve as benchmarks for the global price of carbon.

Read this next

Digital Assets

Sam Bankman-Fried might see his 25-year sentence halved

Sam Bankman-Fried, the founder of the failed cryptocurrency exchange FTX, was sentenced to 25 years in federal prison by a Manhattan court on Thursday. This comes after he was convicted of defrauding customers and investors, with Judge Lewis Kaplan highlighting the potential future risks posed by Bankman-Fried.

Technical Analysis

EURJPY Technical Analysis Report 28 March, 2024

EURJPY currency pair under the bearish pressure after the pair reversed down from the major resistance level 164.25, which also stopped the sharp weekly uptrend at the end of last year,

Digital Assets

BlockDAG’s Presale Hits $9.9M, MultiversX & MINA Price Predictions Show Green

Read about BlockDAG’s promising $10 prediction and insights on MultiversX Price Prediction as MINA’s potential unfolds.

Digital Assets

Rockstar Co-Founder and All-star Line Up Join Advisory Board to Take Metacade into Post Beta Orbit

Metacade, the revolutionary Web3 gaming platform, prepares to streak out of beta with a slew of ground-breaking initiatives that will redefine the way blockchain games are developed.

Retail FX

Prop firm The Funded Trader shuts down, claims relaunch in April

Prop trading firm The Funded Trader has ceased all operations, with claims for a relaunch in the near future.

Digital Assets

Ethereum-Based Tokenized Real Estate Platform USP Launches On Republic

How This Californian Startup Is Revolutionizing Real Estate Investment through Ethereum-Based Tokenization.

Digital Assets

Sui Spikes in Weekly DEX Volume, Joins Top 10 of All Blockchains

March DEX volume on Sui stands at over $2.88B – up more than 49% from February – with decentralized exchange Cetus and wholesale liquidity layer DeepBook leading.

Digital Assets

Prisma Finance suffers $10 million crypto exploit, attack ongoing

Liquid staking protocol Prisma Finance fell victim to a security exploit on March 28, resulting in nearly $10 million in Prisma mkUSD and wrapped stETH being stolen by hackers.

Digital Assets

Masa and LayerZero: Bridging Blockchains for Data Sovereignty

Masa Network is poised to revolutionize the personal data landscape with its upcoming launch as a cross-chain platform, making it accessible on a variety of blockchains right from the start.

<