NYMEX Green Exchange's new CEO thinks global

LONDON (Reuters) - Less than two weeks after taking the helm of NYMEX's struggling Green Exchange, Tom Lewis is wasting no time preparing to battle for supremacy in the $126 billion global emissions market. "We've got many arrows in our quiver. Our goal is to go at this from all fronts," he told Reuters in an interview, adding that Green Exchange has the backing of major investment banks.

"We intend on becoming the largest global platform for emissions trading."

Green Exchange Holdings appointed the former Ameritrade head as its first CEO on Sept 15 after months of lackluster volumes in greenhouse gas permit trading.

NYMEX launched the environmental exchange in early 2008, shortly before it was bought by CME Group.

Green Exchange opened amid market expectations that it would coast on NYMEX's strength in the energy markets to displace the Chicago Climate Exchange (CCX), becoming the main U.S. marketplace for carbon dioxide trading.

But those hopes faded as legislation to set U.S. emissions targets and establish a nationwide carbon market stalled.

"We're not focusing on the daily ups and downs right now ... but my expectation is that we will garner significant market share over the next few years," Lewis said.

"My priorities right now are bringing in talented staff and completing our DCM (Designated Contract Market) application."

DCM status is required to become a stand-alone exchange under the U.S. Commodity Futures Trading Commission.

This move prompted several firms including Goldman Sachs, JP Morgan and Morgan Stanley, as well as hedge funds RNK Capital and Tudor, to step forward as financial partners and liquidity providers.

"DCM status is very significant for us because ... it allows us to operate in these markets under our own regulatory banner," he said, adding that he had no timeline for its completion.

Lewis said also he has recruiters scouring the company's member firms and competitors in search of potential top-level executives, adding that a number of candidates are former bankers, casualties of the economic downturn.

OFFSET PLANS

Analysts expect trade in U.S. emissions to stay muted until the country enacts a regulatory framework for greenhouse gases.

In June, the U.S. House of Representatives passed a climate bill that would see large companies reduce their 2005 emissions levels by 17 percent by 2020 and by 83 percent by 2050.

That bill is incubating in the Senate as President Barack Obama presses to get his healthcare reforms passed.

"I would guess we'll see a bill passed sometime in 2010, then another year for the rules and infrastructure to be aligned, then we'll probably see trading in 2012," Lewis said.

The proposed bill could see carbon offsets account for up to 2 billion tons of emissions cuts per year, meaning there would big money to be made in offset trading.

CCX, owned by Britain's Climate Exchange Plc, is currently the main marketplace for U.S. offsets.

"We have plans to trade offsets, but there is questionable value in 25 cent carbon as to what that does to benefit capital markets or assist environmental goals," he said, referring to the current market price for CCX's offsets.

Lewis said Europe and the U.S. are the limit of Green Exchange's immediate horizon, adding that it would consider mergers or acquisitions as a way of entering other markets.

(Editing by William Hardy)