Carbon, the big new tradeable commodity of the 21st century, is sending profits soaring at The Climate Exchange.

The company, which runs the European Climate Exchange on Bishopsgate in the City and the Chicago Climate Exchange, reported half-year profits of £6.7 million, double where they were a year ago with trading volumes up 250% on the 12 months.

The Climate Exchange is taking advantage of European Union emission trading schemes and their US equivalent. These schemes mean large polluters such as coal-fired power stations have to buy carbon permits to continue to operate.

They can do this through the Climate Exchange, where carbon permits are sold by renewable energy firms such as wind-farm operators or efficient industrial companies that have reduced their carbon output and have a surplus of permits to trade.

"We have not only grown our business at a tremendous pace but more importantly continued to consolidate our number one position in terms of market share both in Europe and the US," said chief executive Neil Eckert.