European Climate Exchange Definition
The European Climate Exchange is a subsidiary of the Chicago Climate Exchange that manages sales and marketing of environental instruments in Europe. More specifically, these are ECX Carbon Financial Instruments (ECX CFIS), which are listed on the International Petroleum Exchange (IPE). The European climate exchange provides spot contracts and ftres contracts under the EU Emission Trading Scheme. EU emissions trading began in January of 2005, to help members meet commitments to the Kyoto Protocol. Emission trading is market based, and has demonstrated an economically efficient means of providing incentives to cut pollution. It does so by incorporating external costs of fossil fuel use into costs of production.