Emissions Trading / Carbon Market News (14/08/2023)

Dear Madam or Sir,

Last week, the German federal government approved the draft economic plan for the “Climate and Transformation Fund” for the years 2024 to 2027.

The fund is said to have a total volume of 57.6 billion euros and will accelerate decarbonization in Germany by investing almost 19 billion in the renovation of buildings, 12.5 billion in Deutsche Bahn, 12.6 billion in renewable energies. Electromobility along with charging infrastructure, will be funded with a good 5 billion euros. In addition, the development of the hydrogen industry and the semiconductor industry should each receive around 4 billion in funding. Almost 21.6 billion are to be made available for the overall measures in the coming year.

However, since the federal government also needs income for this, the price for national emission certificates is to rise next year by 10 euros to 40 euros and not, as originally planned, to 45 euros per tonne of CO2. In 2025, the prices for the national emission certificates will then increase to 55 euros and in 2026 to 65 euros according to the current timetable.

But not only Germany has special national rules for emitters, Hungary has now also passed a national resolution in the form of a decree on the subject of carbon emissions trading. From this month, participants in the EU emissions trading scheme EU-ETS are to pay a levy of EUR 40 per tonne of CO2e and a transaction tax of 10% for all emission allowances allocated free of charge if they sell these free emission allowances before the end of each year compliance period ending April.

The prices in the EU ETS increased at the end of the past trading week and, based on the weekly closing prices, recorded an increase of a good 3.7%. Until the end of the month the auction volumes have been halved and with the EUAs trading above the 200-day moving average again it will be interesting to see whether the demand for EUAs at the auctions continues to increase.

  (Average Quotes Exchange / OTC)   
EUA (Spot-Market)82.74 EUR85:88 EUR+3.14 EUR 
EUA (December-2023-Future)83.65 EUR86.73 EUR+3.08 EUR 
VER (Natural Carbon Offsets)1.90 USD1.80 USD-0.10 USD 
VER (CORSIA eligible Carbon Offsets)0.97 USD0.93 USD-0.08 USD 
nEZ (German National Carbon Units)30.00 EUR30.00 EUR+0.00 EUR 
ICE Brent Crude Oil (Benchmark Future)86.02 USD86.57 USD+0.55 USD 
EURO (Currency, Forex)1.1010 USD1.0946 USD-0.0064 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. The VER quotes are average rates (carboncredits.com), which can be used within the framework of CORSIA and voluntary carbon offsetting. 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