Edmonton, Alta. — Canada’s carbon capture and storage industry needs carbon to be transparent and investable. One path to achieve that is to apply the same rigorous processes and standards used in commodity trading, a convention heard.
Satvinder Flore, chief executive officer of geoLOGIC systems ltd., spoke on a panel titled Navigating CCUS Uncertainty in a Global Market at Carbon Capture Canada.
His company provides data, analytics and training to support energy market decisions. geoLOGIC is DOB Energy’s parent company.
“ … We have to think about the fact that we’re starting a commodity trading market,” he told the Edmonton Convention Centre audience. “So, if we start on the basis that we need to see a commodity trading market, how are we falling short of the standards required for a commodity trading market?”
Carbon credits can be generated and traded in different compliance and voluntary markets, lacking standardization.
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Flore said there needs to be a clear trading regime and offtake agreements, and a clear set of criteria by which to assess investable propositions.
“So, in a commodity market, you know the difference between blue chip stock and a junk bond,” said Flore. “Right now, we don’t have that because we don’t have real clarity around the elements that are required to assess what’s good and what’s bad.”
He added: “If we were looking from a data perspective, one thing that we’re trying to do is provide that baseline, single source of truth upon which you could build a commodity trading market.”
With that said, Flore acknowledged his company is only one in this ecosystem.
However, “if we try and think of the benchmark as being a commodity trading market, we’ll get a lot further.”
Fellow panelist Erik Petursson, vice-president, policy and carbon markets at Entropy Inc., also highlighted the need for market transparency.
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