Emissions Trading / Carbon Market News (30/11/2020)

Dear Sir or Madam,

As the European Commission announced at the end of last week, the calculation of the allocation quotas for emission rights is expected to be delayed until the second quarter of 2021, as the process of setting the emission benchmarks required for this will take even longer.

The Commission will also update the reference values ​​that are to be used to calculate the free allocation of allowances (EUA / EUAA) in the period 2021 to 2025 inclusive. This regulation is expected to be adopted in February 2021.

After the final calculation of the certificates to be allocated free of charge to the systems concerned for the period specified above, the free allocation is to begin in the 2nd quarter of 2021.

The commission emphasized once again that the free allocation for 2021, which will flow to the operators this year, should not be given until April 2022 at the earliest. The certificates, which the operators receive free of charge for 2021, cannot be used for the 2020 surrender obligation, even if they would be allocated before the end of April 2021. In the coming year, the transition from ETS phase 3 (2013-2020) to phase 4 (2021-2030) will be completed.

From December 14, 2020, no new certificates will come onto the market for several weeks, which has already shown its price-driving effect in the past week.

One of the other price-forming factors last week was the oil price, which has been rising towards the US $ 50 mark for Brent crude since the beginning of November.

This week, for the last time this year, a total of 20.8 million EUA will be auctioned on all five trading days at the Leipzig EEX, as 6.4 million pieces from the Polish contingent are on Wednesday. In the coming week, 14.4 million EUA will be auctioned on four trading days and in the 51st calendar week the last 3,959,500 pieces for this year will only be auctioned in Leipzig on Monday, December 14th, 2020.

  (Average Quotes Exchange / OTC)   
EUA (Spot-Market)26.74 EUR28.13 EUR+1.39 EUR
EUA (December-2020-Future)26.74 EUR28.13 EUR+1.39 EUR
CER (Spot-Market)0.31 EUR0.29 EUR-0.02 EUR
ICE Brent Crude Oil (Benchmark Future)45.04 USD48.17 USD+3.13 USD
EURO (Currency, Forex)1.1854 USD1.1963 USD+0.0109 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