The Obama administration proposed a new carbon cap-and-trade program within the latest budget proposal. As luck would have it, there are two exchange traded notes (ETNs) available to target this growing market sector.

Carbon-efficient ETNs have gained more attention as the new administration sets forth its plan for carbon cap-and-trade, a system of emission allowances that delegates how much carbon a company can emit during production. Certain companies pollute at different rates and at different times of the year, so the carbon credits range from one company to another, reports Don Dion for Seeking Alpha.

iPath Global Carbon ETN (GRN) is a note that represent carbon emissions allowances. As with any note, the issuer is presenting a risk that is dependent upon Barclays. The price of GRN could be affected by the credit rating of the issuing bank, Barclays—a concern that has become more acute in the last year as previously “impervious” banks slashed their value. GRN has had a rough go of gaining recognition and investors’ interest so far, but as interest in cap-and-trade grows in the United States, so could attention toward this product.

• iPath Global Carbon ETN (GRN): down 17%  year-to-date

AirShares EU Carbon Allowances Fund (ASO) has a 0.85% management fee and is just shy of $4 million in assets.

• AirShares EU Carbon Allowances Fund (ASO): down 15.9% year-to-date

There are sure to be many more products that track this market and the latest index from S&P is proof. S&P U.S. Carbon Efficient Index was introduced in March, and the new index could eventually lead to an exchange traded product.

Tags: Alternative Energy, ASO, ETNs, Green ETFs, GRN, Obama, Sector ETFs, Socially Responsible ETFs