Ultimately, it depends on how valuable climate protection is to an investor. Some investors have a high willingness to pay for environmental protection, while for others a 0.1 percentage point reduction in return is already problematic. In general, costs depend quite significantly on the emissions of the companies held in the portfolio. By nature, it is cheaper to cap a portfolio's emissions only to the point where it becomes compatible with the 1.5 degree warming target. Making a portfolio completely climate neutral is more ambitious and also more costly.

We are not offering a product for the mass market, but for environmentally sensitive, responsible investors, whose numbers will hopefully increase every year.

In theory, every demand has an influence on the price. In practice, however, it does not - there are too many certificates on the market for that. In the long term, certificates will become increasingly scarce due to the setup of emissions trading. We increase this effect.

According to the EU Commission's official count from May 2022, there have been over 1.449 billion allowances on the market in 2021 and a further 2.6 billion allowances in the market stability reserve.

For the complete decarbonization of investments worth 1 billion euros, experience shows that - depending of course on the respective portfolio structure - we only need emissions allowances for around 30,000 to 50,000 metric tons.

The amount of emissions allowed is set by the number of allowances. The only viable way to improve climate protection is to reduce the quantity directly.

That’s exactly what we’re doing: We buy emission rights so that they are no longer available to others. Even a high price for an emission allowance does not change the total quantity; it only determines the distribution of rights.

Those with the lowest marginal avoidance cost will be the first to reduce emissions. These are those for whom saving another ton of CO2 makes the most economic sense. Who that is and where in Europe this saving takes place, we do not know. It’s also irrelevant for the climate.

It tends to affect companies that have usually paid little attention to energy-efficient production in the past. Investors are thus indirectly accelerating the technology shift through their actions.

Financial speculation only works if the certificates become scarce, i.e. they are actually used at some point. This does not necessarily have to be the case in the current year, but at some point in the future the rights will be used, otherwise the price would not rise. You cannot speculate with economic goods that have no value.

We also prevent this future emission for the end user of the certificate if we buy pollution rights from a financial investor today.

The customer receives a certificate from us confirming the purchase and retirement of emission rights (EUA).

After the transaction is completed, we settle to the cent and provide all receipts from the certificate trader acting on the exchange. Receipt of the emission allowances in the Foundation's Union Registry Account is evidenced by both a letter from the Foundation's Board of Directors and a bank statement.

In the past, this was indeed the simplest way and would still be technically possible today. However, after the introduction of the Market Stability Reserve (MSR), this would reduce our efficiency.

The reason for this is that if a threshold is exceeded, unused certificates result in the auction volume in the following year being reduced by 24 percent of the surplus. The unauctioned allowances are then placed in the MSR and deleted when (as can be expected in the foreseeable future) the maximum number of allowances in the MSR has already been reached.

Deletion of allowances would constitute utilization and would reduce the efficiency to 76 percent. We want the allowances we buy to continue to be considered „unused“ so as not to diminish next year’s auction quantity reduction and achieve 100 percent efficiency.

This way we can guarantee that the certificates will never come back into circulation and be used to emit CO2.

In fact, we could simply hold the certificates ourselves and not use them. But a small risk would remain: Since they have a value, if anything went really wrong, we could be forced by courts or insolvency administrators to sell the certificates. We want to prevent that in any case.

TThe best way to do this is to pass them on to a foundation dedicated to climate protection. The foundation is legally prohibited from selling the certificates because this would contradict the foundation's purpose.

No. Let’s explain why using an example. Say an investor becomes carbon neutral through purchasing the equivalent CO2 emissions, for which they are responsible, for a year. If they then wanted to part with some of their shares, they have therefore taken away some of the responsibility for being carbon neutral from the buyer. A recalculation of the responsible CO2 emissions during the year therefore makes no sense.

If we wanted to pay back money, we would have to resell some of the certificates. We can’t do that because the emission rights are passed on to an environmental foundation, preferably the German Federal Environmental Foundation, immediately after they are acquired and we therefore no longer have any access to them at all.

We have chosen this path to ensure sustainable climate protection.

From an environmental point of view, capital investors need not worry. Investors can safely invest in companies with the highest expected returns without excluding certain industries. The responsible CO2 emissions are fully neutralized by CAP2.

On the other hand, this compensation is more expensive for more environmentally damaging companies than for environmentally friendly ones. The optimal portfolio structure therefore also depends on the companies‘ emissions.

Nothing at all. In offset projects, when the stoves are really used for as long as was hoped, the emission in Europe is counterbalanced by an emission reduction in another country. With our approach, the emission is reduced directly in Europe. The effect on the climate is identical. However, unlike offset projects, we do not incur any control costs.

With the CAP₂ approach, the reduction in CO₂ emissions is irreversible. Compared to reforested forests, which can burn down, be infested by bark beetles, or simply rot over many years and release CO₂ again in the process, with us the CO₂ emissions are not only postponed in time.

In addition, since the Paris Agreement came into force, offsetting emission reductions achieved via offset projects against the host country's own emissions has only been possible in rare exceptions: typically, this only finances the emission reduction already committed to by the host country.

No, because the number of emission allowances is exogenously set by law, we demonstrably reduce the amount of emissions in Europe with every emission allowance purchased and not used. This is possible because participation in EU emissions trading is legally mandatory for many companies and not merely voluntary, as is the case, for example, in trading centers in the USA.

Unlike green investment, where only ownership of greener industrial assets shifts from one investor to another, we achieve a real reduction in emissions.

This is not green washing, but real climate protection.

Emissions trading in the USA and Asia is still in its infancy. The markets are not easily accessible for European buyers and are not sufficiently liquid. The main problem, however, is that participation is voluntary. If prices rise, companies could simply drop out again. A direct link between the retirement of emissions allowances and the reduction of emissions is therefore not guaranteed.

For this reason, we also neutralize emissions from North America or Asia via the EU Emissions Trading Scheme. In any case, it is irrelevant for climate protection on which continent emissions are avoided.