Barclays gets out of carbon credit trading

Published on Wednesday, 25 July 2012 10:26
Written by Vicki Mitchem

Barclays has sold its controlling share in Swedish based carbon project developer Tricorona back to the business's management team two years after spending $159M for an 85% share.

No one has been forthcoming about the value of the sell-back, nor the reasons behind it, but it isn't likely to to be Barclays seeking to cash in a tidy profit. According to Reuters, the 2010 price paid represented something like a 40% premium above the normal trading price pre-deal, while the UN-backed carbon credits which are Tricorona's stock and trade are running at less than three Euros each compared with thirteen back then.

Given that the deal has also got Barclays embroiled in a law suit with CF Partners, whose interest in a takeover were stymied by the Barclays purchase, they are probably cursing the whole episode. 

This is the latest in a pretty long line of sad tales and criticism for emissions trading schemes, once trumpeted as the market saving the planet, but more often seen as plagued by fundamental mismatches of supply and demand and of at best questionable environmental benefit.

It remains to be seen whether future iterations of the European Union Emissions Trading Scheme (EU ETS) can overcome these criticisms and contribute effectively to the battle against climate change.

Source: ©Technology Strategy Board

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