About Us
Clear Sky Carbon Solutions (previously Clear Sky Advisers)
Clear Sky Carbon Solutions (“CSCS”) was established to have no conflicts from fossil fuel mandates.
Our team has a long history and track record investing and trading in environmental credits, with experience with both financial participants and covered emitters.
We have deep market, structural, and regulatory expertise, with relationships to navigate upcoming changes to regulations and climate change policy.
We seek to generate strong alpha while focusing on regulatory-backed programs that seek to reduce Greenhouse Gas emissions (“GHG”).
We rely upon a fundamental view of supply and demand and potential regulatory catalysts to provide the best ideas to our investors.
CSCS offers primary access regulatory carbon credits: California Carbon Allowances (“CCA”), Washington Carbon Allowances ("WCA"), EU Allowances ("EUA"), Regional Greenhouse Gas Initiative ("RGGI") for the states of Connecticut, Delaware, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York, Pennsylvania, Rhode Island, and Vermont, China Carbon Allowances.
COMPLIANCE CARBON MARKETS: A MARKET-BASED APPROACH TO REDUCE
Cap-and-Trade (Compliance Markets):
Cap-and-Trade (Compliance Markets):
Cap-and-Trade (Compliance Markets):
•Starts with a target emissions reduction to be achieved by a predetermined year through binding legislation
•Regulator sets a hard cap on emissions in the first year, usually equal to a baseline across covered emitters
•Fixed supply of carbon allowances are issued – effectively permits to pollute – equal to the hard cap
•Allowances are tradable credits that are sold by the regulator through transparent auction processes. Allowances may be allocated freely to emitters requiring assistance but the total number of allowances never exceeds the cap
•Some compliance programs allow limited use of compliance carbon offsets to satisfy an obligation – compliance offsets are heavily regulated to meet certain quality thresholds
•Supply of allowances is reduced each year, such that in the target year the number of allowances equals the desired (reduced) emissions level for covered emitters
•Emitters with higher costs of abatement may choose to pay emitters with lower costs of abatement to reduce emissions sufficient to meet the reductions for both emitters
•Stringent penalties are enforced for emitters that do not surrender sufficient allowances to meet their obligation
•California’s Cap-and-Trade is a robust compliance market that relies heavily on carbon allowances. Alberta EOS is a compliance market but relies 100% on carbon offsets
VOLUNTARY CARBON MARKETS (VCMs)
Cap-and-Trade (Compliance Markets):
Cap-and-Trade (Compliance Markets):
Voluntary Carbon Markets:
•Corporations and consumers make voluntary commitments to compensate for their emissions through investments that are beneficial to the environment
•Offset Developers advance projects that reduce/avoid or directly remove/sequester carbon from the atmosphere
•Voluntary carbon offsets are tradable credits that store the value of CO2 reductions achieved by the project •Standards Bodies certify and set criteria for carbon offsets
•High-quality carbon offsets meet the following criteria: Additionality, Verification, Permanence, Measurability and Avoid Leakage, however, verification lacks quality-controls and oversight1
•Carbon offsets can be transferred from projects to emitters where they are retired against voluntary commitments
•Prices are market-based but demand is heavily fragmented with buyer preferencesreflecting specific geography, vintage, project type and whether offsets represent reductions or removals
•Due to varying quality and project attributes, pricing is not transparent and standardization is challenging •No direct penalty for failure to comply with voluntary commitments
•Further development is needed to achieve the direct reductions and environmental integrity of compliance programs. Paris Agreement (Article 6) and CORSIA may establish a more robust and transparent global VCM but implementation will have challenges
CARBON MARKETS: COMPLIANCE VS VOLUNTARY
WHY CLEAR SKY CARBON SOLUTIONS? AN EXPERIENCED TEAM
WHY CLEAR SKY CARBON SOLUTIONS? AN EXPERIENCED TEAM
Compliance Carbon Markets are regulated to ensure the environmental integrity of the program and lead to reductions within the jurisdictions regulated and often in targeted communities. The Voluntary Carbon Market requires further development but serves as a valuable complement to compliance programs by providing financial incentives corporations and consumers that are not covered by a stringent compliance program.
WHY CLEAR SKY CARBON SOLUTIONS? AN EXPERIENCED TEAM
WHY CLEAR SKY CARBON SOLUTIONS? AN EXPERIENCED TEAM
WHY CLEAR SKY CARBON SOLUTIONS? AN EXPERIENCED TEAM
DEEP, EXPERIENCED TEAM FOCUSED ON ENVIRONMENTAL CREDITS
INVESTMENTS, TRADING, REGULATION, STRATEGY, AND STRUCTURING
• Long history and track record of investing in Environmental Credits
• Managing portfolios and providing investment strategy since 2007
• Experience at both compliance and financial entities
• Ability to structure physical and futures-based products for clients
• Advice and access to a CITSS account for your own SMA or Fund of One
• Levered physical
• Futures only
• Regulatory experience and relationships to navigate market rules and
climate change policy
• Environmental team is supported by experienced risk, credit, legal, and
investment professionals to help meet the unique needs of our clients
and tailor products to their requirements.
•Firm Ownership and Management Committee Vote is 100% BIPOC