NEW YORK - Investment bank Barclays Capital has shifted its trading of U.S. Northeast carbon allowances to its London desk after a trader in New York left the company, the bank's head of environmental markets said.

Trade in the Regional Greenhouse Gas Initiative (RGGI), a group of 10 states in the U.S. East that put limits on carbon dioxide emissions from power plants starting in January, has fallen in value in recent months.

You can't have a full time trader trading RGGI ... it's small in terms in of traded volume and small in terms of value, said Louis Redshaw, the London-based head of environment trade at Barclays, the investment bank of Barclays PLC (BARC.L).

Delays in the introduction of the federal climate bill by the U.S. Senate have helped push down prices for the right for power generators to emit a ton of carbon dioxide. The bill is now expected to be introduced late this month.

In addition, power generators in the region have switched to burning cleaner natural gas, as swelling inventories of the fuel push down its price, instead of coal, which emits about twice as much carbon dioxide.

We just changed our focus of where we do the actual trading from, but the sales and the client-facing staff are as they were before, he added. He said New York staff may trade the allocations again if trade picks up.

In June RGGI carbon prices slipped 8 percent in the group's fourth quarterly auction of allowances. Its fifth auction will take place on Sept. 9.

Redshaw confirmed that James Macintosh, who traded RGGI allowances from New York, left the company last month.

RGGI on Friday defended the growth of its trading volumes in the secondary market through the second quarter of the year. It said more than 30 firms had significant financial positions in RGGI futures and options contracts by the end of the second quarter, compared to 26 at the end of the first quarter.

(Reporting by Timothy Gardner; Editing by David Gregorio)