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Nasdaq Launches World’s First Index Family Focused on Carbon Removal

Nasdaq has launched three new commodity reference price indexes, based on Puro.earth’s Carbon Removal Certificates (CORCs).

Nasdaq has launched the world’s first index family focused exclusively on tracking the price of carbon removal. With three new commodity reference price indexes, based on Puro.earth’s Carbon Removal Certificates (CORCs), Nasdaq aims to support the growth of the voluntary carbon removal market by creating the transparency needed to encourage investment and support project financing decisions.

“The new family of indexes creating a reference price for carbon removal is another step in Nasdaq’s journey to create a transparent and credible market for carbon removal together with Puro.earth,” said Fredrik Ekström, Head of European Fixed Income and ESG at Nasdaq. “The indexes will create a price benchmark to help our clients better understand the true cost of neutralizing their emissions. They will also serve to stimulate the growth of the carbon removal ecosystems by supporting the business case for new carbon removal projects and help potential investors make better informed decisions.”

The indexes track the price of removing carbon dioxide from the atmosphere through CORCs issued by Puro.earth. A CORC is a tradable digital asset that represents a ton of CO2 that has been removed from the atmosphere. The CORC Carbon Removal Reference Price Index family consists of a composite index that tracks the price of all types of CORC transactions as well as separate reference price indexes for biochar, a solid form of carbon created through a process called pyrolysis, and bio-based construction materials, such as the wood from sustainable forestry as building elements in housing construction.

Specifically, the main index, CORC Carbon Removal Price Index (CORCX), reflects the cost of sequestering one ton of carbon dioxide based on an aggregation of CORC transactions from all engineered carbon removal methods supported by the Puro Standard, the first standard for engineered carbon removal based on international standards for carbon accounting. The CORC Biochar Price Index (CORCCHAR) and the CORC Bio-based Construction Materials Price Index (CORCWOOD) reflect the price of removing one ton of carbon dioxide in the form of biochar and bio-base construction materials, respectively. The indexes will be updated monthly, and more indexes will be added to the family as the number of relevant transactions increases.

“This launch marks an exciting moment for the voluntary carbon market. The indexes will give visibility into the trends of carbon removal credit pricing to climate finance stakeholders and has the potential to pave the way for the commoditization of CORCs,” said Antti Vihavainen, Chief Executive Officer of Puro.earth.

As the world’s first business-to-business marketplace, standard and registry focused solely on carbon removal, Puro.earth identifies companies with products or processes that remove more CO2 from the atmosphere than they emit. The net negative CO2 emissions are verified by an independent third-party and issued as CORCs. As environmental issues came to the fore amid the rise of environmental, social and governance (ESG), Nasdaq acquired a majority stake in Puro.earth in June 2021, seeking to strengthen its ESG offerings further.

The voluntary carbon market is rapidly growing, topping $1 billion for the first time in 2021, according to S&P Global. By 2030, the Taskforce on Scaling Voluntary Carbon Markets forecasts that the market will increase to between $5 billion and $30 billion on the low-end of estimates, with high-end estimates reaching $50 billion.

“Over time, as the voluntary market for carbon removal becomes more liquid, the reference price index family will serve as a platform to create innovative new financial products that support our journey towards a net-zero economy,” said Vihavainen.

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