Category: Carbon Market News

Dear Sir or Madam,

By January 7th, 2021, the software of the Union Registry was subjected to a major update and is now available again for users. Anyone who has logged in since then will see information on the home page that transactions for the EU 100 accounts with system operators can only be carried out with trust accounts based on the dual control principle, and with trading accounts and earlier personal accounts only dual control-Principle to both trust and non-trust accounts. Most account holders have done this in the past.

Another novelty with the accounts is that you can already use EUA on this subpage. EUAA, CHU and CHUA can select. It should be of particular interest, however, that it is now divided into which trading period the EUA or EUAA are as soon as one selects an account. As already mentioned a few weeks ago, the emission rights of the fourth trading period, which will be auctioned from January 29, 2021, cannot be used for the compliance for 2020. When purchasing emission rights for the last year, you should pay attention to this information.

In the past week, not only did the DAX reach a new all-time high of over 14,000 points, the CO2 emission rights also set a new high at 35.20 euros in the December future. There were, of course, reasons for this – optimistic financial markets and below-average temperatures in Europe as well as a generally stronger energy complex further reinforced the bullish tendency. The EUA start the new week a little easier.

(Average Quotes Exchange / OTC)
Instrument	31/12/2020	08/01/2021	Change
EUA (Spot-Market)	32.54 EUR	34.80 EUR	+2.26 EUR
EUA (December-2021-Future)	32.72 EUR	34.92 EUR	+2.20 EUR
CER (Spot-Market)	0.37 EUR	0.37 EUR	+0.00 EUR
ICE Brent Crude Oil (Benchmark Future)	51.42 USD	56.18 USD	+4.76 USD
EURO (Currency, Forex)	1.2197 USD	1.2212 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. CER CP1 and ERU are eligible in ETS until end of March 2015 and must be swapped into EUA. 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

Dear Sir or Madam,

a mutation of the Covid-19 virus has occurred in Great Britain, which is why the British government is trying to seal off the clusters. In addition, France has closed the Eurotunnel and both Germany and Austria have imposed entry stops on aircraft from the island.

This is likely to affect the British economically even before a very likely hard Brexit. However, this is not only associated with economic uncertainties for the British in the coming weeks, but is also likely to have a negative impact on the EU financial markets in the remaining trading days of the end of 2020.

Starting next year, Great Britain will no longer participate in the European emissions trading system EUETS. After both a CO2 tax and emissions trading were up for grabs, the government has now decided on its own CO2 trading system. There will be a minimum price of GBP 15 per ton in the UK ETS and the CO2 certificates will be auctioned on the London ICE as usual.

The affected sectors in Great Britain are now to be reduced by 24% from 155 million tonnes in the coming year to 117.5 million tonnes of CO2e in 2030 using the cap-and-trade mechanism.

However, it is unclear whether the British emissions trading system should be linked to the EU ETS in a similar way to the Swiss emissions trading system and will certainly depend on the outcome of the extended Brexit negotiations.

Last week, the prices for EU emission rights showed a new all-time high of EUR 32.50 per EUA for the high-volume December 2021 contract and the trading week also ended with a visible plus, which in addition to higher energy prices also came with the end of the auctions related.

The ongoing uncertainties regarding the Brexit negotiations and the further development of the pandemic as well as the new British virus mutation will certainly continue to affect trade in the Christmas week. The new week therefore started with a clear minus of more than 3% and some speculators could also use this to take profits.

(Average Quotes Exchange / OTC)
Instrument	11/12/2020	18/12/2020	Change
EUA (Spot-Market)	30.48 EUR	30.92 EUR	+0.44 EUR
EUA (December-2021-Future)	30.52 EUR	31.10 EUR	+0.58 EUR
CER (Spot-Market)	0.31 EUR	0.36 EUR	+0.05 EUR
ICE Brent Crude Oil (Benchmark Future)	49.96 USD	52.26 USD	+2.30 USD
EURO (Currency, Forex)	1.2108 USD	1.2255 USD	+0.0147 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. CER CP1 and ERU are eligible in ETS until end of March 2015 and must be swapped into EUA. 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

Dear Sir or Madam,

In September the European Commission proposed that greenhouse gas emissions in the EU should be reduced by at least 55 percent by 2030 compared to 1990 levels. The previous goal was 40 percent. The new target was based on a comprehensive impact assessment of the social, economic and environmental impacts. This showed that 55 percent fewer emissions are realistic and feasible. The new climate target is now intended to help support Europe’s economic recovery from the coronavirus pandemic.

Even if critics do not go far enough, the European Union has set a milestone with today’s decision and has ended the use of fossil fuels for energy generation in the medium term.

And yes, it would be naive to call for further reductions, because the necessary transformation of society in the post-corona society of Europe will already unsettle quite a few people and without the willingness of the masses to implement any plan, however good it may be, would fail miserably . One only has to think of the cheap populists who are already in the starting blocks to classify climate change as an ideology and to present scientific evidence as unproven despite the greatest possible international consensus.

It was by no means a matter of course that an agreement could take place at EU level, it required a lot of debates and culminated in a night of negotiations, since every EU nation naturally pursues its own interests and still has to be taken along. The German Chancellor Angela Merkel and the French President Emanuel Macron were among the most important supporters, who ultimately prevailed.

As with all urgent EU decisions, a very significant point was the question of funding. Here, the EU fund with 750 million is intended to pave the way to a more sustainable and European economy.

In the run-up to this decision, the market for European CO2 emission rights has positioned itself clearly bullish and set an exclamation mark on Friday last week with an all-time high of 31.30 euros per EUA and this was already exceeded again in today’s early trading.

The market also sees the fact that the Brexit negotiations, which should be concluded by yesterday, are being extended as positive. Only the renewed lockdown in Germany and the failure of the Brexit negotiations are among the factors this week that could put a stop to the bullish market events.

Today, Monday, the last 3,959,500 EUAs for this year will be auctioned at the Leipzig EEX.

(Average Quotes Exchange / OTC)
Instrument	04/11/2020	11/12/2020	Change
EUA (Spot-Market)	30.11 EUR	30.48 EUR	+0.37 EUR
EUA (December-2020-Future)	30.11 EUR	30.52 EUR	+0.41 EUR
CER (Spot-Market)	0.30 EUR	0.31 EUR	+0.01 EUR
ICE Brent Crude Oil (Benchmark Future)	49.06 USD	49.96 USD	+0.90 USD
EURO (Currency, Forex)	1.2122 USD	1.2108 USD	-0.0014 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. CER CP1 and ERU are eligible in ETS until end of March 2015 and must be swapped into EUA. 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

Dear Sir or Madam,

In recent months, the issues of the corona pandemic, the US presidential election and unregulated Brexit have hit the CO2 market hard. Looking at the current news situation, unfortunately none of these issues has yet been finally stamped as settled: The extremely difficult political balancing act of trying to find appropriate yet effective measures to deal with the corona cases does not seem to have been successful in any European country. The recent speech by the outgoing US President Trump does not change the officially confirmed election results, but it does give a bad hint for the coming weeks. And the summit talks between Ursula von der Leyen and Boris Johnson also remained fruitless.

In the sum of these considerations, a significantly lower CO2 price could be below the 25-euro mark – but that is not the case. Instead, the market continued its rally that started at the beginning of November and recently broke through the psychologically important 30-euro mark again. In the search for reasons for this, the connection with the delay in forthcoming auctions and free allocations is naturally obvious, even if these fresh certificates from the fourth trading period could not be used for the current compliance anyway. And then there is the price of oil, which has also picked up speed again and is showing a remarkably similar course to that of pollution rights.

In addition, however, the political efforts to curb global warming have changed the landscape, as an online workshop of the European Commission on the future of the Market Stability Reserve (MSR) revealed a few days ago. Similar to the steering measures taken by OPEC+ countries to stabilise oil prices, the European Commission intends to keep a close eye on the efficiency of the MSF. It should serve as a robust instrument to achieve the net zero emissions target for 2050. To this end, the expert panel expects changes to the rules of the MSF next year, including its trigger levels and rate of uptake.

(Average Quotes Exchange / OTC)
Instrument	27/11/2020	04/12/2020	Change
EUA (Spot-Market)	28.13 EUR	30.11 EUR	+1.98 EUR
EUA (December-2020-Future)	28.13 EUR	30.11 EUR	+1.98 EUR
CER (Spot-Market)	0.29 EUR	0.30 EUR	+0.01 EUR
ICE Brent Crude Oil (Benchmark Future)	48.17 USD	49.06 USD	+0.89 USD
EURO (Currency, Forex)	1.1963 USD	1.2122 USD	+0.0159 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. CER CP1 and ERU are eligible in ETS until end of March 2015 and must be swapped into EUA. 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

Dear Sir or Madam,

As the European Commission announced at the end of last week, the calculation of the allocation quotas for emission rights is expected to be delayed until the second quarter of 2021, as the process of setting the emission benchmarks required for this will take even longer.

The Commission will also update the reference values ​​that are to be used to calculate the free allocation of allowances (EUA / EUAA) in the period 2021 to 2025 inclusive. This regulation is expected to be adopted in February 2021.

After the final calculation of the certificates to be allocated free of charge to the systems concerned for the period specified above, the free allocation is to begin in the 2nd quarter of 2021.

The commission emphasized once again that the free allocation for 2021, which will flow to the operators this year, should not be given until April 2022 at the earliest. The certificates, which the operators receive free of charge for 2021, cannot be used for the 2020 surrender obligation, even if they would be allocated before the end of April 2021. In the coming year, the transition from ETS phase 3 (2013-2020) to phase 4 (2021-2030) will be completed.

From December 14, 2020, no new certificates will come onto the market for several weeks, which has already shown its price-driving effect in the past week.

One of the other price-forming factors last week was the oil price, which has been rising towards the US $ 50 mark for Brent crude since the beginning of November.

This week, for the last time this year, a total of 20.8 million EUA will be auctioned on all five trading days at the Leipzig EEX, as 6.4 million pieces from the Polish contingent are on Wednesday. In the coming week, 14.4 million EUA will be auctioned on four trading days and in the 51st calendar week the last 3,959,500 pieces for this year will only be auctioned in Leipzig on Monday, December 14th, 2020.

(Average Quotes Exchange / OTC)
Instrument	20/11/2020	27/11/2020	Change
EUA (Spot-Market)	26.74 EUR	28.13 EUR	+1.39 EUR
EUA (December-2020-Future)	26.74 EUR	28.13 EUR	+1.39 EUR
CER (Spot-Market)	0.31 EUR	0.29 EUR	-0.02 EUR
ICE Brent Crude Oil (Benchmark Future)	45.04 USD	48.17 USD	+3.13 USD
EURO (Currency, Forex)	1.1854 USD	1.1963 USD	+0.0109 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. CER CP1 and ERU are eligible in ETS until end of March 2015 and must be swapped into EUA. 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