Not long ago, carbon credits were a hot commodity. Many companies expected Congress would pass climate-change legislation, so they tried to get a jump on what they assumed were inevitable cutbacks in their greenhouse gas emissions.

Some invested in carbon credits to offset their pollution, but as legislation stalled, the value of those credits has dropped, in some cases dramatically. Iowa Public Radio's Sarah McCammon reports.

SARAH McCAMMON: What do you do if you're a big company that uses lots of energy, and you want to shrink your carbon footprint? You could become more fuel-efficient or switch to cleaner manufacturing techniques, or you could pay someone else to reduce their CO2 emissions for you, someone like Tim Caldenberg(ph).

Here on his southern Iowa farm on a cloudy day, he's feeding the young steers he keeps in a pen near his farmhouse. Caldenberg is in his late 30s, and he grew up farming around here. Sure, he raises corn and soybeans, but he also raises carbon credits, although lately he's not sure why.

Mr. TIM CALDENBERG (Farmer): In the beginning, it was enough to go out for supper maybe. Well, it's probably less than that now. I could go out for supper now, as long it was a drive-thru, fast food maybe.

McCAMMON: So here's how it works. Caldenberg practices what's known as no-till farming on some of his land. Rather than plowing, he lets CO2 stay trapped in the soil, and then through a bunch of complicated calculations, credits for that captured carbon are sold by the ton on a market called the Chicago Climate Exchange.

Around 100 companies have joined the exchange, like Ford, Sony and IBM, and they agree to cut their emissions by a set amount. It's basically a voluntary version of the cap-and-trade concept that many people have expected Congress to eventually make mandatory.

Back in mid-2008, when there was a lot of optimism that Congress would do that, the value of those credits peaked at more than $7 a ton. Now, they're only worth a dime.

Mr. LENNY HOCHSCHILD (Managing Director, Evolution Markets): If you put all of your eggs in the Chicago Climate Exchange, and you didn't decide to sell anything when you could've had the opportunity to, then I would say at this stage, it's probably difficult.

McCAMMON: Lenny Hochschild is managing director at Evolution Markets, a brokerage firm in New York. He notes that other types of carbon offsets, those bought and sold through contracts instead of on an exchange, are doing better, but they're also down about 40 percent since peaking last year.

The global carbon market is now worth $125 billion, though much of that market is in Europe. The United States' share is still tiny, but Hochschild remains optimistic.

Mr. HOCHSCHILD: I don't think there's one commodity that exists out there that has grown as fast as the carbon markets.

McCAMMON: Some regional authorities in California and the Northeast are taking steps to regulate carbon emissions on their own, but with so much uncertainty about what Congress will do, it's unclear which offsets will count in the future. Matthew Hamilton(ph) is the sustainability manager for Aspen Skiing Company, a member of the Chicago Climate Exchange.

Mr. MATTHEW HAMILTON (Sustainability Manager, Aspen Skiing Company): It really is the Wild West right now. You can go out and buy a product, a renewable energy credit or a carbon credit, and it is only as good as the rules that are attached to that credit.

McCAMMON: Hamilton says the company isn't buying carbon credits for the time being. Instead, it's taking smaller, more tangible steps to shrink its carbon footprint, like more efficient lighting and, that old standby, turning down the thermostat.

For NPR News, I'm Sarah McCammon in Des Moines.

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