Emissions Trading / Carbon Market News (02/01/2024)

Dear Madam or Sir,

In the last short trading week between the Christmas holidays and New Year, there was not too much news that had a fundamental impact on the price of EU emission allowances.

In contrast to the rest of the energy sector, however, European Allowances (EUA) rose slightly by just under two per cent at the end of the week and closed above the EUR 80 mark for the first time since the end of November.

As of today, the new price for national emission allowances in Germany applies, which has risen by a whopping 50 per cent from EUR 30.00 (nEZ23) to EUR 45.00 (nEZ24). For end consumers, of course, plus VAT.

This is still a long way to the prices of EU emission rights, but it will be noticeable for consumers, just like the end of the reduced VAT for the catering industry, which since yesterday is 19% again instead of the corona-related 7%.

Now that the construction industry has entered a crisis due to the rise in interest rates and inflation as well as the high cost of construction services and materials, restaurants are facing a tough challenge as well. Here too, in addition to the search for staff, the question now arises as to whether there will be sufficient demand if these costs are passed on.

The current survey of German liberal FDP members has shown that they are in favour of a continuation of the current government constellation by a narrow majority. An early election is unlikely to be expected from this side.

However, the German state elections in Saxony, Thuringia and Brandenburg, which will take place in September, already allow us to predict that the current governing parties will no longer play a significant role there and that the state parliaments there will move noticeably to the right – towards a party that denies anthropogenic climate change. The decision of the FDP members was therefore a very sensible one, as this could also be expected at federal level.

    (Average Quotes Exchange / OTC)       
EUA (December-2023-Future)78.90 EUR80.37 EUR+1.47 EUR
VER (Natural Carbon Offsets)1.04 USD0.91 USD-0.13 USD
VER (CORSIA eligible Carbon Offsets)0.74 USD0.59 USD-0.15 USD
nEZ (German National Carbon Units)30.00 EUR30.00 EUR+0.00 EUR
ICE Brent Crude Oil (Benchmark Future)78.94 USD76.83 USD-2.11 USD
EURO (Currency, Forex)1.1007 USD1.1036 USD+0.0029 USD

(The VER quotes are average rates (carboncredits.com), which can be used within the framework of CORSIA and voluntary carbon offsetting. 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