The European Union’s Emissions Trading Scheme , the oldest and largest carbon market, has become a model for trading carbon allowances.
Since 2020, carbon prices have dipped to a low of €15 per metric ton in the wake of the height of the COVID-19 pandemic and global lockdowns, and they then reached a high of €96 as global economies reopened and fired on all pistons.
In the beginning, the economic depression from the global financial crisis generated a glut of carbon allowances that kept prices down until a 2018 reform.
Europe has led the charge in carbon markets, providing a blueprint for a robust and investible market.
KRBN tries to reflect the performance of the IHS Markit’s Global Carbon Index, which offers broad coverage of cap-and-trade carbon allowances by tracking the most-traded carbon credit futures contracts.