According to the head of the Future Trading Commission. the carbon futures market might be worth $2 trillion in five years if Congress passes a climate bill this year aimed at regulating greenhouse gas emissions,

“Make no mistake, these carbon markets can be the world’s largest commodity markets in a few short years,” Commissioner Commissioner, Bart Chilton, told a carbon market gathering in Chicago earlier this month.

The chairman of CFTC’s Energy and Environmental Markets Advisory Committee, Chilton said his estimate was drawn from global carbon markets that have grown 312 percent since 2002 — from $100 million to $126 billion.

In developed markets, futures trading — involving the underlying value of carbon emission credits known as derivatives — can be worth 10 to 30 times the physical or cash market, Chilton told the annual meeting of the Chicago Climate Exchange and Chicago Climate Futures Exchange.

To manage the market, which could involve up to 180 million contracts — about the equivalent of the sweet crude oil and natural gas markets combined — CFTC needs additional regulatory tools, he said. “While some solid efforts have been made, nothing has been approved to give us new tools since last year,” he said. “All of this as we are once again seeing oil and gas prices moving up fast.” Oil prices have jumped this year.”

“What I want to make clear is that we need it and need it now — especially as we look to [cap and trade] markets,” Chilton said. Sen. Bernie Sanders (I-Vt.) introduced a bill this month that would require CFTC to use its “emergency power” to rein in excessive speculation on energy markets, a proposal that Chilton supports.

The House Energy and Commerce Committee included expanded CFTC authority over energy markets in the climate bill it approved last month. That bill would put CFTC in charge of the carbon derivatives market and the Federal Energy Regulatory Commission in charge of carbon markets.

The House Agriculture Committee passed a broader bill in February that would give CFTC authority over all “over the counter” transactions and position limits on all “physically deliverable” commodities, as well as additional data reporting requirements. It would place CFTC in charge of all carbon markets.

Senate Agriculture Chairman Tom Harkin (D-Iowa) has introduced and held a hearing on a bill that would bring all over-the-counter trading and swaps onto a regulated exchange. Sen. Carl Levin (D-Mich.) has also introduced similar bills increasing CFTC authority over swaps, position limits and foreign exchanges.