KUALA LUMPUR: Bursa Malaysia Bhd's subsidiary Bursa Carbon Exchange (BCX) has commenced trading and facilitation of off-market transactions of carbon credits.
The exchange said 10 companies from various industries transacted a total of 16,500 Verra-registered carbon credits, by the close of its second day of trading.
This signals an encouraging start for Malaysia's voluntary carbon market (VCM).
Bursa chief executive officer Datuk Muhamad Umar Swift said the company is pleased with the successful go-live of the BCX trading platform.
"Bursa Malaysia's efforts and agility underscores our speed-to-market in fulfilling a national mandate to facilitate the country's shift towards a lower carbon economy," he noted.
Two standardised contracts are offered - the Global Technology-Based Carbon Contract (GTC), focusing on global technology-based greenhouse gas (GHG) reduction projects, and the Global Nature-Based Plus Carbon Contract (GNC+).
The latter features global nature-based GHG reduction projects with co-benefits in the agriculture, forestry and other land use (AFOLU) sector.
Muhamad Umar said the exchange observed a notable surge in participation by smaller companies, demonstrating the growing awareness of environmental responsibility among not just public listed companies, but also among small and medium enterprises.
While the participation of large corporations remains vital, this shift indicates that there is wider embrace of sustainability practices, which suggests future broader demand for decarbonisation projects.
"Our aspiration is to offer a variety of environmental solutions based on market needs. We have received increasing requests from corporates seeking an independent and costeffective platform for renewable energy certificates (RECs) transactions.
"Thus, we are pleased to announce our intent to offer RECs on BCX by the third quarter of next year.
"As a trusted and experienced exchange operator, Bursa Malaysia has a key role in the national energy transition, which is to facilitate financing in low carbon technologies, and accelerating availability of RECs," he said.
The BCX is one of the many initiatives by the exchange to complement proactive efforts by Malaysian companies to reduce their impact to the environment.
Muhamad Umar said BCX will take time to build liquidity as it is in its infancy stage.
In time, Bursa is confident that its various ecosystem building efforts and offering of high quality environmental solutions will surely gain traction.
"We urge leading companies to step up and be early active participants of the BCX, either as a supplier or a buyer," he noted.
BCX is currently waiving its onboarding fee and offering a discount on its trading fee until the end of 2023.
Companies yet to onboard or trade are encouraged to take advantage of the offer before the year ends.
The BCX trading platform was co-designed and developed with Deon Digital AG, which is headquartered in Switzerland.