Emissions Trading / Carbon Market News (03/05/2021)

Dear Sir or Madam,

April 29, 2021 has the potential to go down in history, because for the first time the German Federal Constitutional Court granted the complaints of the young climate protection activists and thus passed an unexpected judgment.

The core of the judgment is that legislative measures for climate protection after 2030 must be regulated in order not to unnecessarily hinder the freedom and life of young people and the following generations in the future. The highest German court has set a deadline for this at the end of next year.

By 2030, Germany is already obliged to reduce greenhouse gas reductions by 55% compared to 1990 and corresponding measures have already been introduced, such as national emissions trading since the beginning of this year, which now also prices emissions from the transport and building sectors.

But this decision will not only point the way for the period after 2030, it will also place a special focus on climate protection in the near future.

In addition, this judgment has fundamentally called into question, which will lead to a serious loss of freedom for today’s children and young people in the future.

Does today’s generation of financially better off adults have the right to drive on the autobahn in a completely oversized car with a combustion engine and a speed of 250 and accept particularly high CO2 emissions in the process? Does we now have the right to travel several times a year by plane and do today’s adults not have to put up with the question of why they allow such exorbitant meat consumption, even though factory farming is one of the largest emitters of greenhouse gases?

The judgment of the Federal Constitutional Court made this clear. In the future, this freedom can be forfeited to protect the climate and future generations, as the foundations of life for future generations must be handled carefully. These livelihoods are to be left to posterity in a state that does not expect children of today and future generations to maintain conditions worth living in on this planet just at the price of radical abstinence.

The young plaintiffs won by convincing the court that our current lifestyle with factory farming, the consumption of unsustainable products and the burning of fossil fuels acutely endangers a future worth living for these children and adolescents.

It would therefore be more than astonishing if the pricing of greenhouse gas emissions did not affect other sectors in the future.

The deadline for submitting carbon emission allowances for 2020 ended last Friday, which was also the last year of the third trading period of the European emissions trading system ETS, which began in 2013.

At 49.41 Euros, the price for one ton of CO2 emissions reached a new all-time high on Friday and closed with a weekly plus of 4% at 48.75 euros on the spot market.

But anyone who thought the rally would be over by the end of the submission period is mistaken this morning, as the market is working its way towards the 50 Euro mark. It remains to be seen whether this will lead to profit-taking and a consolidation of the course.

  (Average Quotes Exchange / OTC)   
EUA (Spot-Market)44.42 EUR46.90 EUR+2.48 EUR
EUA (December-2021-Future)44,33 EUR46.95 EUR+2.62 EUR
CER (Spot-Market)0.62 EUR0.63 EUR+0.01 EUR
ICE Brent Crude Oil (Benchmark Future)66.69 USD66.05 USD-0.64 USD
EURO (Currency, Forex)1.1980 USD1.2097 USD+0.0117 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. CERs CP2 are eligible in ETS until end of April 2021 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