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What are environmental commodities, and why do they exist?

Environmental commodity markets and energy certificates are becoming critical instruments for the reduction of greenhouse gas emissions. They take the form of non-tangible energy credits and are one of the newest categories of globally traded commodities. Their value derives from the needs of the market to produce and consume cleaner forms of energy. Across the world, governments have been placing restrictions on the rights of companies to produce greenhouse gas emissions. Since many companies create these emissions through their operations, environmental commodities emerged to buy and sell these rights. In other words, by limiting companies’ rights to pollute, governments have placed an economic value on the right to pollute. We contribute to this emerging market by actively trading in the environmental commodity categories below.