EGRMGMT 590.14 : Carbon Trading

Please be advised: the information contained on this page is a general overview of the course. As course information is subject to change from one semester to another, please check DukeHub for the most accurate and up-to-date information about EGRMGMT courses.

At a Glance

  • Instructor(s): Louis D. Egger
  • Semester(s) typically taught: Fall
  • Units: 3.0
  • Grading scale: Graded (A-F)
  • Required or elective for MEM degree? Elective
  • If elective, applicable elective track(s): n/a
  • Pre-requisites: n/a
  • Recommended previous courses: n/a

Course Description/Synopsis (from DukeHub)

The goal of carbon trading is to reduce greenhouse gas emissions efficiently through market-pricing mechanisms. This course examines the theory and practice of governments creating tradeable property rights in permission to pollute.

We will study the first such program, introduced through the 1990 Clean Air Act Amendments, which largely eliminated sulfur dioxide (acid rain) in the northeastern US. We will then consider in detail the structure and functioning of the world’s active carbon emissions credit trading markets, with a focus on two of the largest: the European Union (launched 2005) and California (launched 2013).

To facilitate understanding, the course will cover the core concepts and mathematics of financial markets in general, including market and limit orders and the order books, and the use of derivatives, including puts, calls and futures, in managing risk. The course will explore the emerging secondary market ecosystem around carbon trading, including the complementary roles of exchanges, brokers, and non-polluter financial investors, and consider the safeguards needed to avoid fraud and market manipulation.

Finally, students will explore the potential future role of carbon trading in the global effort to control greenhouse gas emissions, including the emergence of new platforms, and the monetization of offsets and carbon capture.

Course Syllabus

EGRMGMT 590 Syllabus – Carbon Trading Fall 2024

Word from the Faculty

Check back at a later time

Resource site for Duke MEM students