Category: Carbon Market News

Dear Sir or Madam,

In 2017, Germany emitted a total of 906.6 million tonnes of CO2 or its equivalents in other greenhouse gases. Thanks in part to the windy weather in 2017, the share of renewable energies was so strong that the energy sector emitted 19.5 million tons less and Germany’s total emissions of climate-damaging greenhouse gases by 4.4 million tons (0.5 %) decreased.

However, at 313 million tonnes, the energy sector is still the sector to which the greatest weight is attached in complying with German climate targets.

Now, Germany’s coal commission has recommended that the complete phase-out of coal be burned by 2038. Since the last German nuclear power plant should be shut down in 2022, this is an ambitious task, even if many environmentalists naturally take too long to do so. After all, the aim is to secure the supply of electricity, make socially compatible job losses and create new prospects for the affected regions.

Federal Minister of Economics Peter Altmaier, who was also Federal Minister for the Environment just a few years ago, knows both sides and assumes that Germany’s climate targets can be met by successive phase-out. Because by 2030, the Federal Republic wants to emit 60% less greenhouse gases compared to the reference year 1990.

However, the phase-out of coal also means that renewables must continue to be developed, the storage technologies for electricity and the power lines that guide wind energy from the north to the south of the republic. Because without coal power and nuclear energy, the main sources of renewable energy and electricity from gas-fired power plants will remain to secure their energy supply.

The costs are currently estimated at 40 billion euros. Of this, 1.3 billion will be provided annually by the federal government for the federal states and an additional 700 million euros annually to secure concrete projects. The rising electricity prices for industry and consumers will be reduced from 2023 by a subsidy to the network charges of two billion euros annually.

Ultimately, the roadmap for further decarbonisation of the German energy industry creates planning security for German industry on the one hand and on the other hand tries to implement Germany’s climate protection goals. It is a compromise, certainly. But a result without compromise on all sides would have resulted in a much worse result, namely none at all. Therefore, it is advisable to look at the work of the coal commission once from this point of view.

(Average Quotes Exchange / OTC)
Instrument	2019-01-11	2019-01-25	Change
EUA (Spotmarket)	24.83 EUR	23.76 EUR	-1.07 EUR
EUA (December-2019-Future)	24.86 EUR	23.93 EUR	-0.93 EUR
CER (Spotmarket)	0.24 EUR	0.24 EUR	+0.00 EUR
ICE Brent Crude Oil (Benchmark Future)	62.59 USD	61.66 USD	-0.93 USD
EURO (Currency, Forex)	1.1367 USD	1.1404 USD	+0.0037 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,

The share of renewable energies in power generation in Germany has cracked 40% last year. On average, 40.4% of the electricity produced in Germany, equivalent to 219 terawatts, came from wind, solar, biomass, hydropower or other renewable sources. At 20.4%, wind power was the clear leader, followed by photovoltaics (8.4%) and biomass (8.3%). For the first time ever in Germany, the renewable industry has generated more electricity than the burning of coal. Brown coal was at 24.1% in 2018 and hard coal at 13.9%. Including gas (7.3%), fossil energy producers only accounted for 45% last year.

In the 49th week of 2018, 53.5% of energy production was generated by renewable energy, but the best weekly value was in the 52nd kW of 2017, where as much as 58.3% of the electricity came from renewable sources.

Since 2010, the share of renewables of 19.3% has more than doubled in Germany and it has been the network operators despite the many times in the past years predicted blackouts have always managed to keep the network stable, even if the cost has caused billions. The completion of the power lines to the south of Germany is therefore more important than ever as the proportion of renewable energies increases.

Although oil prices rose significantly in the last week due to speculation that Saudi Arabia had reduced its oil production, prices for European emission allowances (EUA) fell and closed below the € 24 mark.

This week, the auctions at the Leipzig EEX start again after the winter break. Monday, Tuesday and Thursday each want to find 2.495 million EUA customers, for a total of 7.485 million EUAs. In the following week, there are significantly more due to the Polish auction, namely 11.9135 million EUA and 640,000 emission allowances for air traffic (EUAA).

(Average Quotes Exchange / OTC)
Instrument	2018-12-28	2019-01-04	Change
EUA (Spotmarket)	24.95 EUR	23.49 EUR	-1.46 EUR
EUA (December-2019-Future)	24.98 EUR	23.73 EUR	-1.25 EUR
CER (Spotmarket)	0.25 EUR	0.24 EUR	-0.01 EUR
ICE Brent Crude Oil (Benchmark Future)	53.54 USD	57.07 USD	+3.53 USD
EURO (Currency, Forex)	1.1440 USD	1.1395 USD	-0.0045 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,

Also on the last day of 2018 we would like to take a brief look at the trading activity on the carbon market. Usually, the annual winter break at the auctions is used by many market participants for a holiday and so it comes only to very low trading volume. Nevertheless, there was a wide price range between EUR 24.20 and EUR 25.50.

Another look is dedicated to the auction calendar of the EEX, which, however, is currently still incomplete. For example, the first auctions will start on Monday, January 7, 2019, but the numbers and dates for auctions of German certificates are still missing, as are those of the EFTA states Iceland, Liechtenstein and Norway, which are participating in the ETS for the first time. Poland has already reached an agreement on its national auctions. As already announced, nearly 118 million EUAs will be auctioned by our eastern neighbors in the coming year, what means around 39 million allowances more than in 2018.

Today’s date is worth mentioning the fact that two percent of the total particulate matter pollution of the coming year will be generated in the first few minutes from midnight. So strong is the degree of air pollution from the New Year’s Eve fireworks. Against this background, the community Kreuth in Oberbayern has attracted attention with an exemplary action. Kreuth is a health resort and lies on the southern shore of the famous Tegernsee. It sounds understandable that this year the council has unanimously decided to call residents and guests to a voluntary renunciation of a blazing fireworks. Instead, the community hosts a dazzling celebration with no bang effects. At midnight there is a laser show. “With a fireworks renunciation you help to reduce the particulate matter in our place and do at the same time something good for the animals in our community, that are scared by the noise of the New Year’s Eve rockets,” writes the mayor in a community letter and recommends immediately to donate the money saved by giving up bangers to a reasonable cause.

(Average Quotes Exchange / OTC)
Instrument	2018-12-21	2018-12-28	Change
EUA (Spotmarket)	24.88 EUR	24.95 EUR	+0.07 EUR
EUA (December-2019-Future)	24.92 EUR	24.98 EUR	+0.06 EUR
CER (Spotmarket)	0.24 EUR	0.25 EUR	+0.01 EUR
ICE Brent Crude Oil (Benchmark Future)	55.05 USD	53.54 USD	-1.51 USD
EURO (Currency, Forex)	1.1373 USD	1.1440 USD	+0.0067 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,

Dear Madam or Sir,

Although the year 2018 is not quite over yet, but of course the data collected so far by the German Weather Service (DWD) are sufficient for the statement that we had the warmest year in Germany since the beginning of the weather records. The previous record year of 2014 was exceeded by a further tenth degree of the full year average. But that’s not the only record, because with over 2000 hours of sunshine, 2018 was also the sunniest year. Particularly worrying, according to the vice-president of the DWD, Paul Becker, that eight of the nine warmest years since 1881 fall into the 21st century. He therefore summarized with the words: “The warming continues unchecked, the climate change holds Germany in a vice-like grip”.

But the year 2018 was also characterized by a dramatically positive price trend for CO2 emission certificates. The European Pollution Rights course moved from a level in the range of EUR 7.00 to EUR 7.50 at the beginning of the year to more than EUR 25.00 due to the decisions to reform the trading system. No analyst had seriously expected this rapid price increase, but rather a more gentle increase for the years between 2018 and 2021. For this reason, some market observers have significantly revised their forecasts upwards for the coming years.

By contrast, the price of oil had fallen by around 10 percent in the course of the last trading week. Here, both the economic concerns of investors and the market data themselves seem to play a decisive role.

(Average Quotes Exchange / OTC)
Instrument	2018-12-14	2018-12-21	Change
EUA (Spotmarket)	23.36 EUR	24.88 EUR	+1.52 EUR
EUA (December-2019-Future)	23.37 EUR	24.92 EUR	+1.55 EUR
CER (Spotmarket)	0.25 EUR	0.24 EUR	-0.01 EUR
ICE Brent Crude Oil (Benchmark Future)	60.11 USD	55.05 USD	-5.06 USD
EURO (Currency, Forex)	1.1305 USD	1.1373 USD	+0.0068 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