Carbon creeps into Wall Street reform

Plenty of lawmakers – such as Sens. Maria Cantwell (D-Wash.) and Byron Dorgan (D-N.D.) – fear that climate legislation could create a sprawling carbon trading market that’s vulnerable to abuse.

Senate legislation to tighten federal controls on massive derivative markets includes language that requires an interagency study of existing and future carbon markets, Bloomberg reports.

“The group would be made up of eight agencies, including the Commodity Futures Trading Commission, the Securities and Exchange Commission and the Environmental Protection Agency. It would report to Congress within six months on how to ‘ensure an efficient, secure, and transparent carbon market,’ according to the derivatives bill,” they write.

Derivatives legislation that cleared the Senate Agriculture Committee this week is likely to be merged eventually with broader Wall Street reform legislation that is headed for the Senate floor.