Climate Exchange Plc, the London-listed carbon trading exchange (with exchanges in London and Chicago), has just launched a new product with Deutsche Bank - Catastrophe Event-Linked Futures on the Chicago Climate Futures Exchange.

The man behind this is Dr Richard Sandor, who I interviewed last year. As well as being a top academic, he is a huge and entertaining personality which made my job very easy. This news of a new financial product from Climate Exchange made me think of the last question I asked him from that interview;

DL: "So what does the future hold for you; when emissions have been reduced to zero, we won’t need carbon trading, will we?"

RS "I don’t think this will happen quickly and I’m not particularly worried about it from a business point of view. But yes, the ideal situation is to put yourself out of business. It’s like if you work for a cancer foundation, you hope that one day, there’s no need for a cancer foundation because you’ve cured cancer. As an alternative, I believe in water and I think we know how we can save endangered species. We have a lot more work to do before we’ll run out of products to trade".

Amen to that last sentence in particular. Alternative energy could do with a lot more financial instruments. Right now we have stocks, funds, carbon and ETFs. And a futures contract was only recently developed for ethanol, so how about biodiesel, biogas and silicon?