-  Shell, TFS, ECX scoop top places in new EU carbon trading scheme

-  Top brokers, dealers, service providers in fast-growing environmental markets

The readers of Environmental Finance magazine have voted Shell's environmental products team and inter-dealer broker TFS the top trading company and broker, respectively, in Europe's pioneering - and fast-growing - carbon emissions trading scheme (ETS).

The European Climate Exchange (ECX), which trades carbon contracts via London's International Petroleum Exchange, emerged from a crowded field to win Best Exchange in the EU market, which began operating in January. Allowances for more than 230 million tonnes of carbon dioxide- worth some 4.2 billion euros - have changed hands this year in the EU market, which is designed to reduce emissions of climate change-causing greenhouse gases.

Broker CO2e and project development company EcoSecurities - which has just successfully floated on London's Alternative Investment Market - took top honours in the Kyoto Project Credits categories, covering the Kyoto Protocol's emerging project-based market mechanisms, the Clean Development Mechanism and Joint Implementation.

The Kyoto Protocol entered into force in February, boosting interest in its market mechanisms, which will allow companies to buy and sell "carbon credits" to help them comply with emissions targets between 2008-12.

Meanwhile, environmental and energy broker Evolution Markets made a strong showing in the older US emissions markets - which are designed to help control acid-rain causing sulphur dioxide, and smog-forming nitrogen oxides. Hundreds of power plants and other emitting facilities participate in a number of US emissions markets, helping to bring down the cost of meeting pollution reduction goals.

TFS also swept the board in the weather derivatives markets, voted top broker in North America, Europe, and Japan. The weather derivatives markets are also growing strongly, with notional volumes in financial year 2004-05 almost doubling (up 83%) to $8.4 billion, according to the Weather Risk Management Association. 

The survey also covered markets in Renewable Energy Certificates (RECs), which help support new renewable energy projects. Evolution Markets, TFS, Greenstream Network and Next Generation Energy Solutions were the top-ranked brokers in REC trading.

 "This year has seen environmental markets enter the mainstream, as evidenced by the major investment banks - including Merrill Lynch, Morgan Stanley, and Barclays Capital - which won categories in the survey," said Mark Nicholls, editor of Environmental Finance.

"The launch of the EU Emissions Trading Scheme this year has brought the reality of reducing carbon emissions to more than 4,000 companies across Europe and, more importantly, has put a financial value on emissions reductions," he added."They are turning to the winners in our survey to help them manage an environmental issue that has suddenly become a financial asset - or liability."

"The lessons learnt from the ETS will put EU companies in a strong position to meet their targets under the Kyoto Protocol, which entered into force this year. The recent successful outcome of negotiations in Montreal about the future of the international climate change regime have underscored the central role that emissions trading will play in tackling the world's most pressing environmental problem," he added .

More than 700 companies voted in the annual survey, conducted for the sixth time by Environmental Finance, the leading international magazine covering environmental markets, investment, and risk management. Around 1,500 companies known to have an interest in environmental markets were e-mailed during October and November, and asked to vote in those markets in which they have direct experience.

The results are published in the December 2005-January 2006 issue of Environmental Finance magazine. The full results, and the article which accompanies them (and which provides background and context about the various markets), can be downloaded from www.environmental-finance.com/envfin/05survey.pdf

For further details, please contact:

Mark Nicholls,
Editor
Environmental Finance
Tel +44 207 251 9151
E-mail: mark@environmental-finance.com