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Carbon offset exchange to launch in Singapore by end of 2021

21 May 2021 Hanwei Wu

The Singapore Exchange is joining forces with the Development Bank of Singapore, investment firm Temasek Holdings and the UK's Standard Chartered Bank to develop an exchange for trading carbon offset credits.

Known as Climate Impact X (CIX), the offerings will include the exchange and a project marketplace. CIX will begin offering trading of carbon credits generated from projects involving nature-based solutions towards the end of 2021.

The exchange will enable the trading of "large-scale, high-quality carbon credits through standardized contracts" that the companies say will cater mainly to multinational corporations and institutional investors.

Unlike the exchange, the marketplace is meant for entities seeking to participate in the voluntary carbon market and will offer them a curated selection of natural climate solutions projects, which involve the protection and restoration of natural ecosystems. Each project will be supported with environmental risk and pricing data, the project's backers said.

The partners intend to leverage satellite monitoring, machine learning and blockchain technology. Conversations are underway with global rating agencies to provide independent environmental ratings for the projects, they said.

To ensure the integrity and quality of its credits, CIX plans to work with global partners and international working groups, including the Taskforce on Scaling Voluntary Carbon Markets (TSVCM) and the Natural Climate Solutions Alliance.

"By facilitating a well-functioning marketplace with strong impact and risk data, CIX will enable efficient price discovery and catalyze the development of new projects," said Mikkel Larsen, interim CEO of CIX and chief sustainability officer at DBS, said in a 20 May statement accompanying the announcement.

CIX is born out of Singapore's Emerging Stronger Taskforce's Alliance for Action on Sustainability, a government-led initiative that aims to position the country as a hub for carbon-related services.

Original reporting by Hanwei Wu, OPIS.

Posted 21 May 2021 by Hanwei Wu, Editorial Director, OPIS, IHS Markit

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