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Chicago Climate Exchange Names Founding Members

Submitted by: Chicago Climate Exchange

Categories: Environment

Posted: Jan 16, 2003 – 11:00 PM EST

 

Leaders from Automotive, Chemical, Commercial Real Estate, Environmental Services,Electric Power Generation, Electronics, Forest Products, Municipal, Pharmaceutical and Semiconductor Sectors to join North American Voluntary Private Sector Program to Reduce and Trade Greenhouse Gases

Jan. 16 /CSRwire/ - CHICAGO,IL - Efforts to develop market-based solutions to global warming reach a milestone today as leading U.S. and international companies and the City of Chicago announce they will be the Founding Members of Chicago Climate Exchange (CCX®), a voluntary cap-and-trade program for reducing and trading greenhouse gas emissions. In an unprecedented voluntary action, these entities have made a legally binding commitment to reduce their emissions of greenhouse gases by four percent below the average of their 1998-2001 baseline by 2006, the last year of the pilot program.

The founding members of CCX include American Electric Power (AEP), Baxter International Inc., the City of Chicago, DuPont, Equity Office Properties Trust, Ford Motor Company, International Paper, Manitoba Hydro, MeadWestvaco Corporation, Motorola, Inc., STMicroelectronics, Stora Enso North America, Temple-Inland Inc. and Waste Management,Inc.

“The private sector’s response to the initiative has been incredible,” says internationally known financial innovator and Chairman and CEO of CCX, Dr. Richard L. Sandor. “These companies have demonstrated tremendous leadership. They really believe that a proactive approach to climate change advances everyone’s long-term interests. It’s simply good business.”

"For years our financial exchanges have been a vital part of the local and national economy," said Chicago Mayor Richard M. Daley, who is also Honorary Chairman of the CCX. "This is a good example of the kind of innovation that will help us solve our energy and environmental problems."

Today’s announcement marks the first time major companies in multiple industries have made a voluntary binding commitment to use a rules-based market for reducing their greenhouse gas emissions. CCX will enable them to receive credit for such reductions and to buy and sell credits in order to find the most cost-effective way of achieving reductions. Trading is targeted to begin in the spring of 2003.

CCX will administer this pilot program for emission sources, farm and forest carbon sinks, offset projects and liquidity providers in North America. To foster international emissions trading, offset providers in Brazil can also participate. The development of CCX resulted from feasibility and design studies that were funded by grants from the Chicago-based Joyce Foundation and administered by Northwestern University’s Kellogg Graduate School of Management. Environmental Financial Products, LLC conducted the research and development effort.

CCX market architecture incorporates input from a wide range of economic sectors as well as technical experts in the engineering, forestry, agricultural, academic, NGO and public sectors. In total, more than 50 corporate entities and hundreds of experts have contributed to the design phase.

International Paper Chairman and CEO John Dillon said, "CCX is a truly innovative, market-based approach to the resolution of critical aspects of greenhouse gas and climate issues that can be a prototype for resolving other environmental issues. As a founding member, International Paper's goal is to present a progressive model that inspires other industrial companies to reduce emissions and pool collective efforts to help manage the risks of climate change through economically viable and creative programs such as this one."

"Ford wants to be at the forefront in understanding and developing cost-effective and flexible voluntary emissions reduction policies like emissions trading schemes and that is why we have signed on to Chicago Climate Exchange," said Martin Zimmerman, Group Vice President, Ford Motor Company, "We voluntarily agreed to participate because we believe this is an important next step in exploring innovative mechanisms to cost-effectively reduce greenhouse gas emissions. The data developed through this innovative program will inform the public debate about market-based CO2 reduction mechanisms."

"AEP has considerable experience with existing sulfur dioxide and nitrogen oxide emissions credit markets," said Dale Heydlauff, AEP's senior vice president, governmental and environmental affairs. "Our participation in CCX is a natural next step, since it takes the market-based approaches that lowered the costs of emission reductions for the other gases and applies them to greenhouse gas emissions. Through CCX, we hope to demonstrate the viability of a multi-sector greenhouse gas trading program. CCX also serves as a mechanism for the company to participate in the Bush Administration's voluntary climate change program."

"As part of our overall Global Corporate Citizenship Program, Motorola has established
challenging goals for reduction of emissions that might impact climate change," said Richard Guimond, Motorola's Vice President and Corporate Director for Environment, Health, Safety, Risk, and Quality. "We believe that innovative ideas are needed across corporations, governments, and other organizations to find ways to protect the environment for our future generations. The Chicago Climate Exchange is clearly one of those pioneering concepts that hopefully will help lead the way to achieving significant environmental improvements in the most cost-effective manner possible. Motorola is pleased to be participating in this leadership program and we hope that it can contribute to a better understanding of what can be accomplished through market-based voluntary programs."

"We recognize that the risks and complexities of climate change are so important that we must work together to meet this challenge," said William Blackburn, vice president of corporate environmental affairs for Baxter International Inc. "We believe that initiatives such as the Chicago Climate Exchange have great potential because it brings together the ingenuity and experience of all sectors of our society -- private, public and non-governmental -- in the development of cost-effective, constructive and sustainable solutions for addressing climate change."

CCX selected NASD to provide regulatory services and Rothschild Inc., an affiliate of the
prestigious London-based bank N. M. Rothschild & Sons Limited, to provide investment banking services. Detailed discussions are underway with 53 additional corporations who are interested in becoming members of CCX. A second group of members is expected to be announced in the next 90 days.

Dr. Sandor noted: “There have been years of discussion about the potential for trading carbon emissions, but the CCX will offer the first test of the concept on a scale with global potential. A representative carbon trading market can yield lessons that may be relevant for economies worldwide for years to come.”

For more information, please contact:

Rafael Marques Chicago Climate Exchange
Phone: +1-(312) 554-3384
Michael Walsh Chicago Climate Exchange
Phone: +1-(312) 554-3380

 

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