Dubai Financial Market launches pilot for carbon credits trading at COP28

Dubai Financial Market (DFM) announced on Thursday the introduction of a pilot program for trading carbon credits in conjunction with its “COP28” hosting.

“The pilot platform will serve as an integrated platform to explore the sale, purchase, and use of carbon credits and provide a mechanism to help companies manage unavoidable carbon emissions, along with the implementation of decarbonization strategies,” The Dubai Financial Market said in a statement on Thursday.

“Experimental trading of eligible institutional investors will take place from December 4 to 8, while carbon balance adjustments will end on January 10, 2024,” according to the statement.

“The platform will see the participation of more than 17 major Emirati companies, including the Dubai Electricity and Water Authority, DB World, Emirates NBD Bank, and Emaar Properties, where transactions will be executed through 5 brokerage companies operating in the Dubai Financial Market,” the statement explained.

“Dealing with clearing and reconciliation operations will be in US dollars, through Dubai Clearing and Dubai Deposit, with a daily reference to global prices by leading pricing agencies, such as the Oil Price Information Service (OPIS) listed on the Dow Jones U.S. Equity Index,” according to the Dubai Financial Market statement.

“Carbon credits traded through the Dubai Electricity and Water Authority and MyCarbon will come from internationally approved carbon projects around the world, including initiatives to avoid, reduce, and eliminate carbon emissions, stressing that all projects have been verified by a specialized and globally accredited classification body,” the statement added.