Emissions Trading / Carbon Market News (20/06/2022)

Dear Madam or Sir,

Despite the ongoing pandemic situation last year, emissions from Germany’s plants covered by the European emissions trading system EU ETS will be almost back to the pre-Corona level in 2021.

The energy sector in particular has contributed to this, with emissions rising for the first time since 2013. These were 14% or 235 million tonnes of CO2 higher than in the previous year, since more coal was used during the economic recovery despite higher CO2 prices. Ultimately, this has also led to a corresponding increase in electricity prices since then.

The emissions of the energy-intensive industry in Germany only increased moderately by 5% compared to the previous year, but they were almost at the pre-corona level.

After there were significantly fewer flight movements in 2020, the share of German aviation emissions rose last year by a fifth to 4.6 million tons of CO2.

Regarding the targets for reductions in the EU ETS (minus 43% compared to 2005 by 2030), Germany is currently 31%, visibly behind the European average of 38% compared to 2005. And at the European level, Germany was also the leader in increasing the Greenhouse gas emissions, which makes further efforts to ensure compliance with the Paris climate protection agreement by politicians urgently necessary.

After the reform proposal of the environment committee was rejected by a majority of the European Parliament two weeks ago, a new compromise proposal is now to be voted on Wednesday. Now the reduction factor should be more than 63% and the linear annual reduction factor 4.4% in 2024 and 4.6% from 2029 compared to the previously proposed 4.5%. This is currently 2.2%, after having been 1.74% in the third phase of EU emissions trading. In addition, the free allocation of emission rights is to expire in the years 2027-2032.

The market for EU emission allowances reacted with a moderate weekly gain of 51 cents in December futures. The vote on Wednesday will remain exciting.

  (Average Quotes Exchange / OTC)   
Instrument10/06/2217/06/22Change
EUA (Spot-Market)81.74 EUR82.24 EUR+0.50 EUR
EUA (December-2022-Future)81.86 EUR82.37 EUR+0.51 EUR
VCU (Voluntary Carbon Units ø)10.42 USD9.20 USD-1.22 USD
VER (Gold Standard Spotmarkt ø)4.62 USD4.45 USD-0.17 USD
nEZ (German National Carbon Units)30.00 EUR30.00 EUR+0.00 EUR
ICE Brent Crude Oil (Benchmark Future)122.01 USD114.54 USD-7.47 USD
EURO (Currency, Forex)1.0515 USD1.0495 USD-0.0020 USD

(The average exchange quotes and OTC-prices shows the average between bids and ask of several exchanges and OTC markets for carbon emission rights in the ETS. Bid and ask has usually in Spot Market a visible spread. The VER quotes are average rates (carboncredits.com), which can be used within the framework of CORSIA and voluntary carbon offsetting. Crude Oil and Euro Currency shows day-end-exchange quotes. This market information has just an informational character and are no advice or offer to trade carbon emission rights or their futures and options. If you want to unsubscribe, please reply to this mail.)

Please call our international carbon desk if any further questions exist: +49.2831.1348220.

With kind regards,

Advantag Services GmbH

Emissions Trading / Carbon Market News (13/06/2022)

Dear Madam or Sir,

Last Wednesday, the EU Parliament met and voted on the proposals for the reform of EU emissions trading system. These were rejected with 340 no and 265 yes votes.

MEP Dr. Peter Liese, who worked out the compromise proposal and brought it to the vote, sees the main blame for this in particular with the social democratic parliamentary group, which was particularly dissatisfied with the timetable for the introduction of the CO2 border taxation and the expiry of the free allocation of CO2 emission rights.

The Greens, on the other hand, found the proposal too softened by the lobbyists of the fossil industry, as MEP Michael Bloss announced.

Now the talks in the Environment Committee regarding the reform of the EU ETS have to start all over again.

The market then reacted with significant losses, but remained stable above the EUR 80 mark towards the end of the trading week.

In the new week, a total of 8,830,500 EUAs and 600,000 emission allowances for the aviation industry (EUAA) will be auctioned at the Leipzig energy exchange EEX.

  (Average Quotes Exchange / OTC)   
Instrument03/06/2210/06/22Change
EUA (Spot-Market)88.73 EUR81.74 EUR-6.99 EUR
EUA (December-2022-Future)88.87 EUR81.86 EUR-7.01 EUR
VCU (Voluntary Carbon Units ø)10.85 USD10.42 USD-0.43 USD
VER (Gold Standard Spotmarkt ø)4.98 USD4.62 USD-0.36 USD
nEZ (German National Carbon Units)30.00 EUR30.00 EUR+0.00 EUR
ICE Brent Crude Oil (Benchmark Future)121.69 USD122.01 USD+0.32 USD
EURO (Currency, Forex)1.0562 USD1.0515 USD-0.0047 USD

(The average exchange quotes and OTC-prices shows the average between bids and ask of several exchanges and OTC markets for carbon emission rights in the ETS. Bid and ask has usually in Spot Market a visible spread. The VER quotes are average rates (carboncredits.com), which can be used within the framework of CORSIA and voluntary carbon offsetting. Crude Oil and Euro Currency shows day-end-exchange quotes. This market information has just an informational character and are no advice or offer to trade carbon emission rights or their futures and options. If you want to unsubscribe, please reply to this mail.)

Please call our international carbon desk if any further questions exist: +49.2831.1348220.

With kind regards,

Advantag Services GmbH

Emissions Trading / Carbon Market News (06/06/2022)

Dear Madam or Sir,

The rapporteur on the European emissions trading system EU ETS and spokesman for the largest group in the European Parliament (EPP, Christian Democrats) Dr Liese presenting an amendment from his group and the liberal Renew Europe group, Peter Liese said: “With our compromise amendment, we give industry and citizens more breathing space in difficult times and avoid a price shock in 2024. At the same time, we achieve even more greenhouse gas reductions than in the Commission proposal. “

However, with a four-vote majority against Liese’s recommendation, the committee approved a significant increase in ambition compared to the European Commission’s proposal. Instead of the Commission’s proposed 61% reduction in greenhouse gas reductions, the committee voted for 67%. In addition, a vote was taken to withdraw around 240 million certificates in 2024. The Renew group has now agreed to a compromise. The one-time reduction is now only to be 70 million in 2024 and a further 50 million emission rights are to be withdrawn from the market in 2026.

By assuming a higher linear reduction factor, according to Dr. Liese the target be changed to 63% by 2030, which is also important and the total emissions between 2024 and 2030 are therefore lower than the Commission proposal and ultimately more ambitious.

In addition, the EPP tabled the following amendments, among others, such as a joint amendment on carbon leakage protection for ports, an amendment on a bonus for sustainable alternative fuels in shipping, an exemption for ships carrying LNG and hydrogen, and one amendment to restrict market access to avoid manipulation and speculation.

In addition, the EPP wants to submit an amendment to all seven Fit-For-55 reports this week in plenary to call for a regulatory moratorium in view of the high energy and commodity prices and the war in Ukraine.

On a weekly basis, EU emissions allowances have risen by 5.5% and are heading back towards the EUR 90 mark, which has been breached several times in the past six months.

This was not least due to the fact that last week, due to the public holidays, a total of only five million EUAs were auctioned at the Leipzig EEX on just two days. Due to Whit Monday, a total of 9.2 million EUAs will only be offered on four days this week.

  (Average Quotes Exchange / OTC)   
Instrument27/05/2202/06/22Change
EUA (Spot-Market)84.08 EUR88.73 EUR+4.65 EUR
EUA (December-2022-Future)84.20 EUR88.87 EUR+4.67 EUR
VCU (Voluntary Carbon Units ø)10.76 USD10.85 USD+0.09 USD
VER (Gold Standard Spotmarkt ø)4.73 USD4.98 USD+0.25 USD
nEZ (German National Carbon Units)30.00 EUR30.00 EUR+0.00 EUR
ICE Brent Crude Oil (Benchmark Future)115.08 USD121.69 USD+6.61 USD
EURO (Currency, Forex)1.0732 USD1.0747 USD+0.0015 USD

(The average exchange quotes and OTC-prices shows the average between bids and ask of several exchanges and OTC markets for carbon emission rights in the ETS. Bid and ask has usually in Spot Market a visible spread. The VER quotes are average rates (carboncredits.com), which can be used within the framework of CORSIA and voluntary carbon offsetting. Crude Oil and Euro Currency shows day-end-exchange quotes. This market information has just an informational character and are no advice or offer to trade carbon emission rights or their futures and options. If you want to unsubscribe, please reply to this mail.)

Please call our international carbon desk if any further questions exist: +49.2831.1348220.

With kind regards,

Advantag Services GmbH

Carbon Market News (06/06/2022)

Dear Madam or Sir,

The rapporteur on the European emissions trading system EU ETS and spokesman for the largest group in the European Parliament (EPP, Christian Democrats) Dr Liese presenting an amendment from his group and the liberal Renew Europe group, Peter Liese said: “With our compromise amendment, we give industry and citizens more breathing space in difficult times and avoid a price shock in 2024. At the same time, we achieve even more greenhouse gas reductions than in the Commission proposal. “

However, with a four-vote majority against Liese’s recommendation, the committee approved a significant increase in ambition compared to the European Commission’s proposal. Instead of the Commission’s proposed 61% reduction in greenhouse gas reductions, the committee voted for 67%. In addition, a vote was taken to withdraw around 240 million certificates in 2024. The Renew group has now agreed to a compromise. The one-time reduction is now only to be 70 million in 2024 and a further 50 million emission rights are to be withdrawn from the market in 2026.

By assuming a higher linear reduction factor, according to Dr. Liese the target be changed to 63% by 2030, which is also important and the total emissions between 2024 and 2030 are therefore lower than the Commission proposal and ultimately more ambitious.

In addition, the EPP tabled the following amendments, among others, such as a joint amendment on carbon leakage protection for ports, an amendment on a bonus for sustainable alternative fuels in shipping, an exemption for ships carrying LNG and hydrogen, and one amendment to restrict market access to avoid manipulation and speculation.

In addition, the EPP wants to submit an amendment to all seven Fit-For-55 reports this week in plenary to call for a regulatory moratorium in view of the high energy and commodity prices and the war in Ukraine.

On a weekly basis, EU emissions allowances have risen by 5.5% and are heading back towards the EUR 90 mark, which has been breached several times in the past six months.

This was not least due to the fact that last week, due to the public holidays, a total of only five million EUAs were auctioned at the Leipzig EEX on just two days. Due to Whit Monday, a total of 9.2 million EUAs will only be offered on four days this week.

  (Average Quotes Exchange / OTC)   
Instrument27/05/2202/06/22Change
EUA (Spot-Market)84.08 EUR88.73 EUR+4.65 EUR
EUA (December-2022-Future)84.20 EUR88.87 EUR+4.67 EUR
VCU (Voluntary Carbon Units ø)10.76 USD10.85 USD+0.09 USD
VER (Gold Standard Spotmarkt ø)4.73 USD4.98 USD+0.25 USD
nEZ (German National Carbon Units)30.00 EUR30.00 EUR+0.00 EUR
ICE Brent Crude Oil (Benchmark Future)115.08 USD121.69 USD+6.61 USD
EURO (Currency, Forex)1.0732 USD1.0747 USD+0.0015 USD

(The average exchange quotes and OTC-prices shows the average between bids and ask of several exchanges and OTC markets for carbon emission rights in the ETS. Bid and ask has usually in Spot Market a visible spread. The VER quotes are average rates (carboncredits.com), which can be used within the framework of CORSIA and voluntary carbon offsetting. Crude Oil and Euro Currency shows day-end-exchange quotes. This market information has just an informational character and are no advice or offer to trade carbon emission rights or their futures and options. If you want to unsubscribe, please reply to this mail.)

Please call our international carbon desk if any further questions exist: +49.2831.1348220.

With kind regards,

Advantag Services GmbH

Emissions Trading / Carbon Market News (30/05/2022)

Dear Madam or Sir,

The meeting of the G7 climate protection, energy and environment ministers came to an end last Friday.

One of the most important points here is that the G7 countries have, for the first time, committed themselves to achieving a predominantly decarbonised electricity supply by 2035 and ending coal-fired power generation in the process. Furthermore, direct international public financing of fossil fuels is to be phased out by the end of this year. Inefficient fossil fuel subsidies are to be phased out by 2025, and by 2030 a highly decarbonised transport sector is to prevail in the G7 countries.

Measures to protect species and the sea, against plastic pollution and for resource efficiency were also decided. The main results of the meeting were recorded in a joint communiqué from all G7 countries.

After the price losses of the previous week, the price for European emission allowances has recovered somewhat and there is still hope that the European Commission’s proposal to auction up to an additional 250 million EUAs will not be accepted or will only be accepted in a significantly weaker form.

Because capital, raw material and energy markets live from the trust of market participants in the system, which falters when such serious interventions are carried out. In addition, the possible price loss and the price gains that did not materialize would be responsible for the fact that visibly less revenue would be achieved in the auctions that have already been planned. This will also happen if speculative institutional investors were alienated. For this reason, the EU would be well advised to thoroughly reconsider such thoughts regarding the universal principle of cause and effect.

  (Average Quotes Exchange / OTC)   
Instrument20/05/2227/05/22Change
EUA (Spot-Market)80.24 EUR84.08 EUR+3.84 EUR
EUA (December-2022-Future)80.39 EUR84.20 EUR+3.81 EUR
VCU (Voluntary Carbon Units ø)10.53 USD10.76 USD+0.23 USD
VER (Gold Standard Spotmarkt ø)4.73 USD4.73 USD+0.00 USD
nEZ (German National Carbon Units)30.00 EUR30.00 EUR+0.00 EUR
ICE Brent Crude Oil (Benchmark Future)112.87 USD115.08 USD+2.21 USD
EURO (Currency, Forex)1.0562 USD1.0732 USD+0.0170 USD

(The average exchange quotes and OTC-prices shows the average between bids and ask of several exchanges and OTC markets for carbon emission rights in the ETS. Bid and ask has usually in Spot Market a visible spread. The VER quotes are average rates (carboncredits.com), which can be used within the framework of CORSIA and voluntary carbon offsetting. Crude Oil and Euro Currency shows day-end-exchange quotes. This market information has just an informational character and are no advice or offer to trade carbon emission rights or their futures and options. If you want to unsubscribe, please reply to this mail.)

Please call our international carbon desk if any further questions exist: +49.2831.1348220.

With kind regards,

Advantag Services GmbH