The Commodity Futures Trading Commission (CFTC) ruled that environmental commodities (e.g. renewable energy certificates, offsets, allowances) are nonfinancial commodities and exempt from regulation under the Dodd-Frank Wall Street Reform and Consumer Protection Act. Dodd-Frank imposes clearing requirements for certain types of financial instruments (swaps) including the requirement that transacting parties post collateral deposits. The CFTC ruling exempts participants transacting renewable energy certificates and other environmental commodities from having to post collateral deposits, freeing up capital that would have been required as a collateral deposit for the developer's use in other pursuits.
News Article -
CFTC Approves Swap Definition Triggering Dodd-Frank Rules
Additional Information -
Dodd-Frank Final Rules, Guidance and Orders