Markit, a financial information services provider, and BlueNext, one of the leading environmental exchanges, today announced their intention to form a strategic partnership to create a range of indices and related products for the carbon and wider environmental markets.
The alliance will combine the strengths of Markit's established global index business with BlueNext's leadership in the EU Emission Trading Scheme and Certified Emissions Reductions (CERs) markets.
As the importance of carbon emissions trading increases, there is growing demand for more transparency and visibility in this market. Markit and BlueNext plan to launch a family of emission index products that will allow market makers, investors and the broader market to gain access to a transparent, observable benchmark. These will be used for trading and risk management purposes, and will facilitate the creation of institutional and retail investment products.
The Markit BlueNext EUA  Spot Index and the Markit BlueNext CER Spot Index will be the first in a series of jointly-branded environmental products.
Niall Cameron, Executive Vice President of Commodities, Indices, Equities and Risk Management at Markit, said: "A partnership with BlueNext makes perfect sense for Markit given their sigificant presence in the exchange-traded spot markets. As we have seen in many other markets, the establishment of a recognised benchmark provides the foundation for greater transparency and liquidity in institutional and retail-targeted products."
Jean-Pierre Hort, Deputy Chief Executive Officer of BlueNext, said: "This partnership comes at a very opportune time as the climate issue is high on the political and regulatory agenda. Markit's expertise in index development combined with our expertise in the environmental markets will allow us to provide the financial community with an index family which has the potential to become a global reference for the environmental marketplace."
Emmanuel Fages, Market Analyst at ORBEO, commented: "Orbeo welcomes the introduction of Markit-BlueNext new carbon indices. This initiative, launched by an established and recognized exchange platform, will prove extremely useful to help players such as ORBEO to deo develop trackers or structured products fitted to the needs of a wide array of investors. Carbon can essentially be considered as a long-term asset and will attract growing interest from investors worldwide."
Andrew Ager, Head of Carbon and Emission Trading at Bache in London, said: "We look forward to contributing to this promising initiative and we'll support the development of the highest quality indices."