Emissions Trading / Carbon Market News (01/02/2021)

Dear Sir or Madam,

It shouldn’t surprise anyone – in Germany, greenhouse gas emissions in the Corona year 2020 fell by more than 80 million tons to around 722 million tons, according to estimates by the “Agora Energiewende” think tank. Here Germany has even exceeded the ambitious goal of reducing greenhouse gas emissions by 40% compared to the reference year 1990 by the end of 2020; the current status of the data investigations showed that the total reduction was 42.3%.

Here, the corona-related emission reduction is awarded about 2/3 part. Without this effect, however, the decline would also have been another 25 million tons compared to 2019, which would, however, only mean an overall reduction of 37.8% compared to 1990.

Due to the further increase in the share of renewable energies of around 45% in 2020, the real reductions in emissions were only recorded in the electricity sector, as the think tank Agora emphasized. In addition, due to the further increase in the prices of CO2 certificates, coal-fired power generation was replaced by the use of gas-fired power plants as well as renewables, whereby gas is 40% less harmful to the climate than coal. Power generation from coal in Germany has been halved since 2015, particularly due to the European CO2 emissions trading system.

For the year 2021, however, Agora assumes that emissions will rise again, as emissions in the industrial and transport sector are expected to rise, which is why prices for carbon emissions will continue to rise.

The national German CO2 emissions trading, which starts this year for the building and transport sector at € 25 per ton, will continue to drive the trend towards building renovation, renewable heat production and electromobility, but more far-reaching climate policy measures would have to be taken to achieve this not endanger the climate targets.

In the past week, the prices for European emission rights moved between 32.22 and 34.69 euros per ton and closed on a weekly basis with a minus of 3.7%. On Friday the first auction of new EUAs of the 4th trading period took place, which was carried out for Germany. A total of 27 bidders have bid for the 2,651,000 EUA with a cover ratio of 1.59, whereby the final auction price was 33.51 euros and Germany received revenues of 88.8 million euros. This week, 15.1 million EUA from the quotas of the EU, Poland and Germany will be auctioned on all five trading days.

  (Average Quotes Exchange / OTC)   
EUA (Spot-Market)34.15 EUR32.88 EUR-1.27 EUR
EUA (December-2021-Future)34.24 EUR32.95 EUR-1.29 EUR
CER (Spot-Market)0.36 EUR0.35 EUR-0.01 EUR
ICE Brent Crude Oil (Benchmark Future)55.18 USD55.03 USD-0.15 USD
EURO (Currency, Forex)1.2173 USD1.2136 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.

With kind regards,

Advantag Services GmbH