Category: Carbon Market News

Dear Sir or Madam,

In Germany, the word of the year was chosen by the German Language Society last week, in keeping with the World Climate Change Conference in Katowice: Hot-Time.

One of the most impressive speeches was given by 15-year-old Swedish environmental activist Greta Thunberg, who has been raising awareness of climate change through a school strike with the “Climate Justice Now” initiative since this summer. She says in clear and understandable terms that the politicians from cowardice do not pull the emergency and finally do something serious about climate change. “You are not even mature enough to tell us the truth. Even this burden is left to us children. “, The intelligent girl explains and denounces the consequences of our western-decadent consumer society. She called on politicians from around 200 countries to treat the climate crisis as an existential crisis and end the use of fossil fuels. She goes on to say: “If solutions are so hard to find in this system, then maybe we need to change the system.”

The unpopularity of political action towards the decarbonisation of society has recently been demonstrated in France, when the government wanted to tax fossil fuels higher, causing unrest across the country through the “yellow west” movement. The governments of the western industrialized countries now have the difficult task of combating climate change while avoiding social conflicts.

In Polish Katowice, the 24th Conference of the Parties (COP24) came to an end after an extension. Following the Paris Climate Agreement, arrangements were agreed on how to achieve the objectives of the 2015 Agreement. Furthermore, the report of the Intergovernmental Panel on Climate Change, of which we reported a few weeks ago, was accepted, even if the wording used here appears absurd.

Unfortunately, binding regulations, which oblige the states to reduce greenhouse gas emissions, are missing completely and there are no sanctions in case of non-compliant, own goals of the participating states.

However, the conference set further targets for payments to cover the poorer states affected by climate change by 2025. Furthermore, from 2024 on there should be a transparent global data collection on the development of greenhouse gas emissions, since this currently does not exist.

Next year, the world climate conference COP25 will take place in Chile. There is one of the priorities of Carbon trading, in which the European Union plays a leading role. Insofar as European emissions trading proves its effectiveness as an optimal market policy instrument for reducing greenhouse gas emissions in the EU through the renewals adopted in 2017, further regions will follow and the way to global emissions trading will be further developed.

Whether this ultimately leads to more justice in the world and to a more sustainable consumption behavior, or whether a free ticket will “continue to be”, as Greta Thunberg executes in her remarkable speech will show.

Prices for European emission allowances increased significantly last week by 15% to more than € 23 per tonne of CO2, due in particular to the fact that today the last auction for this year takes place on the EEX and therefore less volume is available on the market. And high prices for the emission of greenhouse gases is a valid reason for the polluters to avoid their emissions.

 

 

(Average Quotes Exchange / OTC)
Instrument	2018-12-07	2018-12-14	Change
EUA (Spotmarket)	20.30 EUR	23.36 EUR	+3.06 EUR
EUA (December-2018-Future)	20.30 EUR	23.37 EUR	+3.07 EUR
CER (Spotmarket)	0.25 EUR	0.25 EUR	+0.00 EUR
ICE Brent Crude Oil (Benchmark Future)	60.89 USD	60.11 USD	-0.78 USD
EURO (Currency, Forex)	1.1396 USD	1.1305 USD	-0.0091 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 or +44.20.79790283.

 

With kind regards,

Advantag Services GmbH

Dear Sir or Madam,

While in Germany above all politics and the car industry are struggling for a solution to curb fine particles pollution in cities, this problem is largely ignored by our neighbors in Poland. According to a study published by the World Health Organization (WHO) at the end of 2017, of the 50 EU cities with the highest levels of air pollution, 33 are in Poland. This is mainly due to private heating stoves and the country’s coal-fired power plants. In many cities, a majority of residents still heat coal, some of which are inferior. Even household waste ends up in the kilns, such as plastic bottles and electric cables. The Silesian city of Katowice is now in the fight against smog on drones, which thanks to a special device can “smell” above the chimneys, what is being burned. The local police can immediately catch and punish those who use toxic substances. However, the fine of 100 euros hardly scares anyone. It still remains much cheaper to pay the fines than to buy quality coal for the whole winter.

Currently, the participants of the 24th World Climate Conference can directly get an idea of ??the situation themselves. There, according to media reports, good progress towards uniform standards has been made at the expert level, so that in the coming days the responsible ministers can deal with the further decisions. As was the case last year, former Governor Arnold Schwarzenegger also appeared in Katowice and caused a stir with his comment that America’s president was “meschugge”.

At about the same time a year ago, the reform of European emissions trading with important key data from 2021 was decided. At that time, the course for CO2 emission certificates stood at around 7 euros. The market effectiveness of the decisions has thus been more than proven. But the host of this year’s climate conference seems to want to do everything to prevent a further increase in the price of carbon above the 20-euro mark. In September, for example, at the political level, efforts were made to tackle a further rise in prices. Last week, Poland sparked the next step by announcing that it would like to launch more than 50 million previously held certificates in the coming year. The reaction was simply terrible. Had the price settled stable at just over 20 euros at the beginning of the week, it plummeted on Thursday within a very short time by more than 2 euros and was stopped only at the 18-euro mark. Obviously, a number of companies benefited from this, which were covered with certificates as if by the push of a button. However, this had the consequence that the price on Friday regained its old state back, almost as if nothing had happened.

 

(Average Quotes Exchange / OTC)
Instrument	2018-11-30	2018-12-07	Change
EUA (Spotmarket)	20.50 EUR	20.30 EUR	-0.20 EUR
EUA (December-2018-Future)	20.50 EUR	20.30 EUR	-0.20 EUR
CER (Spotmarket)	0.27 EUR	0.25 EUR	-0.02 EUR
ICE Brent Crude Oil (Benchmark Future)	59.17 USD	60.89 USD	+1.72 USD
EURO (Currency, Forex)	1.1316 USD	1.1396 USD	+0.0080 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 or +44.20.79790283.

 

With kind regards,

Advantag Services GmbH

Dear Sir or Madam,

Yesterday, the 24th World Climate Change Conference (COP24) was launched with participants from 196 states parties in Katowice, Poland, the heart of the Silesian Coal Basin. Already in 2013, the conference took place in the Polish capital, as 80% of Poland’s energy supply comes from coal.

Starting today, leaders will meet to formulate political expectations for the conference and in particular send a signal for “just transition,” the just transition to a climate-neutral world. This week is being negotiated at civil servants level. In doing so, the texts underlying the negotiations should have the greatest possible consensus. Points for which no agreement can yet be reached will be negotiated at ministerial level in the second week. On Friday, December 14, the final documents will be approved by the plenary session of the Conference of the Parties.

In the run-up to last week, the European Commission presented a roadmap for the transition to a low-carbon economy. According to the European Commission, greenhouse gas emissions in the EU should be reduced by 80% by 2050 compared to 1990 levels; By 2030 it should be 40%, by 2040 then 60%.

Here, the Commission sees the greatest savings potential in electricity generation and distribution, as it could be virtually emission-free by 2050, replacing fossil fuels with renewable energies. The transport sector should also generate 60% less emissions and the building emissions 90%. The industry should also contribute its share through energy-efficient technologies with a reduction of 80% by 2050. In agriculture, however, growth is forecast to increase by one-third due to rising global demand.

In addition, the German Federal Environment Agency published updated cost rates last week, according to which each tonne of CO2 emitted causes damages of € 180. These include destroyed ecosystems, dying animal and plant species, production losses, crop losses or damage to buildings and infrastructure. The lignite-fired power generated in Germany alone resulted in environmental damage costs of € 31.2 billion in 2016, or just under 21 cents per kilowatt-hour.

As a result of our collective action and our consumption-oriented lifestyle, 2018 became one of the hottest years since weather records began, according to World Meteorological Organization WMO last Thursday. It is the fourth-hottest year since weather records began. The WMO warns urgently that the time to act is scarce and makes, like all other reputable organizations and scientists also, the people responsible as a fire accelerator.

Even in otherwise rain-prone Germany, in 2018, the largest drought ever recorded since 140 years ago began. The extremely low water levels of the rivers are still noticeable, despite a slight increase in precipitation. You do not have to be a coffee grinder reader to see what will happen if the glaciers of the Alps are no longer supplying water and such periods of drought persist for several years.

It is therefore to be hoped that the negotiations in Katowice will be successful and that those responsible for global greenhouse gas emissions will pave the way for transition to a low-carbon future. Because climate change is here and we are already experiencing the beginning of the effects.

 

 

(Average Quotes Exchange / OTC)
Instrument	2018-11-23	2018-11-30	Change
EUA (Spotmarket)	20.18 EUR	20.50 EUR	+0.32 EUR
EUA (December-2018-Future)	20.21 EUR	20.50 EUR	+0.32 EUR
CER (Spotmarket)	0.27 EUR	0.27 EUR	+0.00 EUR
ICE Brent Crude Oil (Benchmark Future)	59.00 USD	59.17 USD	+0.17 USD
EURO (Currency, Forex)	1.1337 USD	1.1316 USD	-0.0021 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 or +44.20.79790283.

 

With kind regards,

Advantag Services GmbH

Dear Sir or Madam,

Now the EU has also signed the Brexit treaty with Great Britain, thus paving the way for exit from the EU on 29.03.2019. However, whether the ultimately sensible path for both sides can be brought to an end or whether a disorderly exit will still take place, ultimately depends on the approval of the British House of Representatives and the EU Parliament. Assuming that the EU Parliament agrees, the biggest risk is now in London, as already in the ranks of the advocates and the opponents of Brexit a lot of resistance stirs. These uncertainties should continue to occupy the financial markets until the final security.

On Thursday, the World Weather Organization WMO has reported the frightening fact that the concentration of climate-damaging greenhouse gases is higher than ever and no trend reversal is discernible. According to the WMO, the CO2 concentration in the atmosphere rose from 403.3 ppm (particles per million) in 2017 to 405.5, an increase of a whopping 46 percent compared to pre-industrial levels (before 1750). Furthermore, since 1990, radiation propulsion has increased by a significant 41 percent due to long-lived greenhouse gases. The radiation drive is the energy balance of the earth to understand; it includes all forces that either warm or cool our planet. According to the WMO, the most important greenhouse gas CO2 contributed a total of 2/3 of this. Methane, the second most important greenhouse gas, contributed 17 percent, reaching 257 percent of pre-industrial levels. It arises mainly in the context of livestock farming.

Recently, the Earth experienced a similarly high level of CO2 three to five million years ago, as evidenced by ice drilling and analysis of fossils. This resulted in a 3 – 4 °C higher global average temperature, which caused a 10 – 20 meters higher sea level. This heat phase lasted for 3,000 years. However, according to the scientists, the CO2 concentration has never risen so abruptly in Earth’s history as in the past 70 years, caused by the rise of global industry.

Regrettably, very few people use this knowledge as the basis for their daily consumer decisions.

Brent crude oil prices peaked at $ 86.44 a barrel in early October, with the price of fossil fuel plummeting since then, dropping just under 12% last week to $ 59.00. This looked to US President Donald Trump as his merit, which sweetened him the Thanksgiving weekend in Florida. One reason for this is the US stocks, which are at annual high. However, the prices will put pressure on OPEC, which meets in two weeks and has appropriate funding cuts on the agenda.

Despite this development of Oil, the price of carbon emission rights of the European genus in the past week has clearly set in motion and broke the barrier of 20 euros last Wednesday. After a short four-week high at 21.39 euros, the emission rights closed at just over 20 euros.

It will be interesting to see how the auction demand develops in the coming days, as the last auction of emission rights this year takes place on the EEX Leipzig in exactly three weeks, on 17/12/2018.

 

(Average Quotes Exchange / OTC)
Instrument	2018-11-16	2018-11-16	Change
EUA (Spotmarket)	19.11 EUR	20.18 EUR	+1.07 EUR
EUA (December-2018-Future)	19.11 EUR	20.21 EUR	+1.10 EUR
CER (Spotmarket)	0.26 EUR	0.27 EUR	+0.01 EUR
ICE Brent Crude Oil (Benchmark Future)	66.98 USD	59.00 USD	-7.98 USD
EURO (Currency, Forex)	1.1414 USD	1.1337 USD	-0.0077 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 or +44.20.79790283.

 

With kind regards,

Advantag Services GmbH

Dear Sir or Madam,

Last week, the German Federal Cabinet adopted uniform regulations regarding driving bans on diesel cars. This should exclude cars with hardware retrofits from the driving ban. At the same time, the Federal Cabinet decided on Thursday to amend the Federal Immission Control Act. The bill seeks to exclude diesel cars of emission standards Euro 4 and 5 from the ban, insofar as they emit nitric oxide of less than 270 milligrams per kilometer. Average Euro 5 diesel currently emits about 900 milligrams of the harmful gas per kilometer. However, Jürgen Resch from Deutsche Umwelthilfe, which initiated the lawsuit, assumes that these will also be affected from 2020 onwards, as these too sometimes exceed the limit values ​​by a factor of 25.

Furthermore, the Federal Immission Control Act should be amended in such a way that the limit from which driving bans are issued should not come from a concentration of 40 milligrams NO2 per cubic meter of air, which in 2017 affected a total of 65 German cities, lifted up to 50 milligrams, which only 15 cities crossed. Hereby, the German legislator opposes the regulations of the EU. Whether this is permanent, future will show.

The years of sitting out of politics has now caused a new low, as now in Essen, the busy federal highway A40 is threatened by driving bans.

Naturally, the German car industry prefers to sell new cars to the drivers concerned, which makes no sense from the point of view of climate protection and resource conservation, merely promotes sales of new cars and shifts nitrogen production to other countries.

Developments in European carbon allowance prices were initially characterized by better auction demand last week, with prices breaking the € 20 mark at the start of the week and rising to € 20.65 per tonne. Afterwards, Brexit once again gave cause for annoyance. The EU and UK negotiators negotiated a Brexit treaty that was an agreement on the lowest common denominator for both sides.

However, the Prime Minister came under pressure after the resignation of ministers and further threats of resignation, with a vote of no confidence in the room. The EU has already signaled that the requested renegotiations on the part of the EU would not lead to any significant change.

At the end of last week, this put pressure on the emission allowance prices, which caused a slight drop compared to the previous week. The start of the week is also characterized by losses and it is expected that further development in the UK will have an impact on this week’s trading activity.

 

(Average Quotes Exchange / OTC)
Instrument	2018-11-09	2018-11-16	Change
EUA (Spotmarket)	19.45 EUR	19.11 EUR	-0.34 EUR
EUA (December-2018-Future)	19.50 EUR	19.11 EUR	-0.39 EUR
CER (Spotmarket)	0.27 EUR	0.26 EUR	-0.01 EUR
ICE Brent Crude Oil (Benchmark Future)	69.67 USD	66.98 USD	-2.69 USD
EURO (Currency, Forex)	1.1335 USD	1.1414 USD	+0.0079 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 or +44.20.79790283.

 

With kind regards,

Advantag Services GmbH