A GAS HOUSE GANG

Paul Tudor Jones


By ZACHERY KOUWE

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December 12, 2007 -- Hedge fund billionaire Paul Tudor Jones has partnered with several big Wall Street firms and The New York Mercantile Exchange to form a new electronic venue for trading carbon greenhouse gases and other emissions, The Post has learned.

According to people familiar with the deal, the new venture, to be called The Green Exchange, will compete with the Chicago Climate Exchange, which was established last year for carbon trading.

In addition to Jones' firm, Tudor Investment Corp., and the Nymex, the new exchange is backed by Morgan Stanley, Credit Suisse, JPMorgan and Merrill Lynch.

Evolution Markets, a leading broker in the environmental markets and clean energy sector, is also taking a large ownership stake in The Green Exchange, sources said.

Wall Street firms, hedge funds and power companies such as Con Edison are increasingly trading carbon and other emissions such as nitrous oxides and sulfur oxides, as countries around the world try to reduce the causes of global warming.

While alternative energy is being pushed to replace traditional fossil fuels, regulators are favoring a cap-and-trade-scheme that allows polluters to trade emissions among themselves.

The European Union is further ahead with the carbon trading scheme, but several states in the US have adopted programs and others are planning to do so.

The global carbon market is already about $30 billion and some analysts estimate that it could grow into a $3 trillion market over the next 20 years.

The Green Exchange plans to trade carbon allowances, carbon credits and futures on other emissions.

The contracts will be listed on CME Globex, an electronic platform controlled by the Chicago Mercantile Exchange.

Globex also facilitates electronic trading in the Nymex's key oil and natural gas contracts.

The Nymex hopes to use its relationships with large energy and power companies to persuade them to trade on their system instead of the Chicago Climate Exchange, sources said.

Carbon and emissions exchanges have already been opened in Canada and Australia. zachery.kouwe@nypost.com