Dubai Financial Market to pilot carbon credit trading at COP28

Dubai Financial Market to pilot carbon credit trading at COP28

The Dubai Financial Market (DFM) on Thursday said it will launch a pilot program for trading carbon credits at the COP28 event set to take place in the city later this month.

More than 17 UAE companies, including Dubai Electricity and Water Authority (DEWA), DP World, Dubai Municipality, Dubai International Financial Centre (DIFC), Emirates NBD, Majid Al Futtaim, will participate in the project, DFM said in a statement.  

The pilot will explore the trading and use of carbon credits, providing a mechanism to help companies manage unavoidable and residual carbon emissions. Each carbon credit offsets one ton of CO2 equivalent emissions.

Carbon credits, or carbon offsets, are permits that allow holders to compensate for emissions of carbon dioxide or other greenhouse gases.

DFM will commence the pilot program for institutional investors who can buy and sell with trading between December 4 and  December 8, 2023, with the offsetting period ending on January 10, 2024.

The carbon credits traded on DFM will be supplied by DEWA and MyCarbon, and come from ‘internationally certified carbon projects’ worldwide and include carbon avoidance, reduction and removal initiatives, DFM said.

The transactions will be executed through five DFM brokers, namely Al Ramz Capital, Arqaam