Thailand’s state-owned electricity generating company and 10 of the nation’s biggest companies have set up a voluntary emissions-offset program.

This “Carbon Markets Club” has one of the world’s largest conglomerates (Charoen Pokphand Group) and Bangkok transit operator BTS Group Holdings as two of the founders.

Since its early start in June, the club has traded ~15,000 tonnes of CO2. The intent is to expand into a full carbon-trading exchange for the whole country. There are +40 other companies that have expressed interest in joining the group.

The plan is to build a system similar to exchanges in the European Union and China, where big emitters offset their carbon footprint by purchasing credits from companies.

Club members can trade credits over-the-counter in an effort to speed up energy transition. Revenues from the trades would be invested in clean energy or technologies.

With million tonnes of supply and not a lot of companies wanting to cap their own emissions, Thailand’s voluntary system still has more supply than demand and the prices are less than $1 per tonne.

This is a stark contrast to the other markers such as the EU where pricing is above $60 per tonne. The EU, where carbon-intensive sectors such as oil and steel are subject to a cap-and-trade that can push up prices as authorities tighten climate goals.

The Thai Government has also been promoting a bio-circular-green economic model, and their own voluntary emission reduction program called T-VER.

The ultimate goal is to extend the carbon market beyond T-VER to provide a platform for trading all carbon credits both within the country and across borders.

Voluntary corporate commitments to net-zero emissions are the main driving force behind increased carbon-credit demand, according to a World Bank report.

This is part of a bigger global effort to reduce climate change impacts and limit global warming from pre-industrial levels to well below 2 degrees Celsius.