Senators Urge CFTC To Regulate Carbon Credit Markets

A group of seven U.S. senators have written a letter to the Commodity Futures Trading Commission ("CFTC"), expressing concerns with the integrity of the carbon credit markets and urging the CFTC to investigate and regulate voluntary carbon offsets markets.

On October 13, 2022, Senators Cory Booker, Elizabeth Warren, Edward Markey, Richard Blumenthal, Bernard Sanders, Jeffrey Merkley, and Kirsten Gillibrand sent a letter to CFTC Chairman Rostin Behnam requesting that the CFTC establish "rules governing the carbon market." While carbon credits are designed to provide offsets for carbon emissions based on other actions that have reduced or removed carbon dioxide from the atmosphere, the senators cited "[s]everal studies ... highlight[ing] that carbon offset projects are frequently illegitimate[]." Even "those that do contribute to meaningful emissions reductions," they added, can "often [be] representative of broader 'pay to pollute' schemes. ..."