4 September 2007

For Immediate Release

Would You Like A Carbon Credit With That Decorative Plant, Madam?

The formerly esoteric commodity of Carbon Credits arrived on Trade Me this morning, creating yet another business opportunity for savvy local traders.

Meridian Energy launched Trade Me’s new Carbon Credits category with three offerings, two aimed at householders and a third designed for businesses.

The two auctions on offer to households each include a parcel of 20 Gold Standard Verified Emission Reduction carbon credits from Meridian Energy's Te Apiti wind farm. Bidding started at $1 but quickly accelerated and is now sitting at more than a hundred dollars (for the latest bid details go to http://www.trademe.co.nz/Business-farming-industry/Carbon-credits/auction-116636317.htm).

The business-sized parcel is for 1000 credits and has already climbed above $500 (http://www.trademe.co.nz/Business-farming-industry/Carbon-credits/auction-116638198.htm).

Michael Carney, marketing analyst and author of ‘TRADE ME SUCCESS SECRETS’, the definitive guide to Trade Me, had this to say about the launch:

‘Globally, carbon credit trading is a big deal. Estimates of the market size vary from US$10 billion to as high as US$2.3 trillion of trades by 2012. That’s a huge opportunity for online trading venues like Trade Me – too big to resist. And it’s a smart opportunity for Kiwi entrepreneurs as well.

‘What exactly are carbon credits and why would a Trade Me member want to own any? At heart, they’re a tool to offset pollution. Under international agreements such as the Kyoto Protocol, most of the world has agreed to limit greenhouse gas emissions to a predetermined level. Countries and companies that exceed those limits – that pollute more than they’re supposed to – need to offset those emissions somehow. One of the ways they can do that is to purchase carbon credits from those people and organisations who are puffing out less emissions than they should, or who are even reducing emissions. Trees, for example, do a great job of absorbing carbon. Forest owners are suddenly very popular dinner guests.

‘So why on earth should a Trade Me user buy Carbon Credits? If you’re a heavy metal industrialist in your spare time, the answer is obvious. Otherwise? Well, as we’ve already noted, the market is going to be huge. Signatories to the Kyoto Protocol need to start reducing their emissions from 2008. There’s simply going to be more and more demand for Carbon Credits. And we can’t grow trees fast enough.

The New Zealand government is a potential purchaser of Carbon Credits as well, having gone on record as moving the public service towards carbon neutrality. This year the first group (the Ministries for the Environment, Health, & Economic Development, the Departments of Inland Revenue & Conservation and Treasury) is committing to reach carbon neutrality by 2012.

‘Limited supply, increasing demand. Are Carbon Credits the new PlayStation 3? No wonder Trade Me’s entrepreneurs are in hot pursuit. Credits purchased on Trade Me can be used to offset greenhouse gases, unbundled into smaller lots, resold or held as an investment.

‘A word of warning. Don’t get too carried away bidding on these first auctions. Yes, there’ll be bragging rights if you end up with a parcel of the first Carbon Credits officially sold on Trade Me. If they’re promoted correctly – like the Tana Umaga handbag malfunction or the Prime Minister’s father’s car – these first three parcels will have enhanced value as collectors’ items. But you need to look at the underlying value of the Carbon Credits themselves to determine what’s a sensible price to pay.’

These aren’t the first Carbon Credits to be listed on Trade Me, but they are the first to be authorised by the site’s operators. Carbon Credits sold on Trade Me are listed in the new M-co user-friendly carbon emission units registry called 'Regi' (regi.co.nz), which provides for the verification and transfer of carbon credits between buyers and sellers. All this is consumer protection, to ensure that the credits meet prudential requirements and also that any changes of ownership are tracked and regulated.

Michael Carney again: “This is only the tip of the iceberg in terms of trading resource-type commodities on Trade Me. We live in a country where various groups have resource rights – fishing quota’s a good example – that they can’t necessarily use themselves. Trade Me is the ideal transparent market, where eager sellers meet willing buyers. We had to say goodbye to the smoke-filled rooms some time back, when the Smokefree Act came into force. Now let’s get the wheeling and dealing out into the light as well.”

ENDS

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