Emissions Trading / Carbon Market News (15/01/2023)

Dear Madam or Sir,

Following several earthquakes, a volcano has erupted in Iceland for the second time in two weeks, emitting large quantities of dust, ash and lava as well as CO2.

Over the past millions of years, volcanoes have ensured that there is sufficient CO2 in the atmosphere to prevent the heat from the sun’s rays in the atmosphere from being quickly reflected back into space, thus creating temperatures conducive to life.

Deniers of human-made climate change like to point this out while ignoring the fact that humans currently emit 100 times more greenhouse gases into the atmosphere each year than all volcanic eruptions combined. As a result, the balance is significantly disturbed and the so-called greenhouse gas effect leads to an increase in the global average temperature with the known consequences, such as extreme weather events, which occur much more frequently the higher the global temperature rises.

These extreme weather events occur because the atmosphere absorbs more moisture, which leads to exceptional regional precipitation and the jet stream responsible for the respective weather conditions slows down in its movement. This in turn leads to weather patterns remaining stable for longer, resulting in either months of rainy weather, as was the case this winter, or months of drought, as was the case in 2018/2019.

These correlations should be recognized by agriculture, then the further subsidization of fossil fuels, which cause this climate change and thus cause more frequent crop failures, would not be high on the list of priorities.

Last Thursday, the auction calendar for national emissions trading in Germany was published by the Leipzig-based EEX. The first auction will take place much later this year than last year, when the auctions started on 10/01/2023.

As before, the nEHS auctions will take place on Tuesdays and Thursdays.

The following dates are of special interest:

  • 05/03/2024 First auction in national emissions trading 2024 (nEZ23/nEZ24)
  • 19/09/2024 Last auction for 2023 nEZ
  • 05/12/2024 Last auction for 2024 nEZ in 2024

The first auction for EU emission allowances (EUAs) takes place today and it will be interesting to see what demand will look like after EUAs lost almost 14% in the last week alone and even briefly fell below the EUR 65 mark. This price level was last seen 15 months ago. However, if the current price level holds, a technical counter-reaction back above the EUR 70 mark would be likely; if not, then the EUR 60 mark would merely be a psychological resistance level.

    (Average Quotes Exchange / OTC)       
EUA (December-2024-Future)76.35 EUR65.81 EUR-10.54 EUR
VER (Natural Carbon Offsets)1.18 USD1.81 USD+0.63 USD
VER (CORSIA eligible Carbon Offsets)0.54 USD0.74 USD+0.20 USD
nEZ (German National Carbon Units)45.00 EUR45.00 EUR+0.00 EUR
ICE Brent Crude Oil (Benchmark Future)78.75 USD78.13 USD-0.62 USD
EURO (Currency, Forex)1.0943 USD1.0949 USD+0.0006 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