News

Dear Sir or Madam,

The German Bundestag passed the climate protection law last Friday and now only has to pass the Bundesrat. The law sets out how much CO2 can be emitted each year in the areas of buildings, transport, agriculture, energy and industry. The goal of greenhouse gas neutrality by 2050 for Germany will be enshrined in law for the first time. So far, the Federal Government’s 2050 target has been 80 to 95 percent CO2 reduction. The starting price per tonne of CO2 for the transport and housing sectors should be just 10 euros from 2021 onwards.

The German Greens, on the other hand, who have just held their congress in Bielefeld, demand a price of 60 euros per tonne of CO2 and could head for the Chancellery with consistently good election polls.

Regardless, even Chancellor Angela Merkel sees a global warming of 3°C as likely, should the international community remain with the current climate protection goals. According to the Federal Chancellor, 20 percent of the world’s population consumed 80 percent of global resources, which is why these states have a special responsibility.

Greenhouse gas prices continued to be slightly bearish last week, losing nearly one euro. It can not be ruled out that the market will remain under pressure in the new trading week and wants to test the half-year low of EUR 22.03, after having broken important technical support measures. In addition, this week will bring 15,781,000 on five trading days on the Leipzig EEX for auction.

(Average Quotes Exchange / OTC)
Instrument	08/11/2019	15/11/2019	Change
EUA (Spotmarket)	24.84 EUR	23.85 EUR	-0.99 EUR
EUA (December-2019-Future)	24.84 EUR	23.85 EUR	-0.99 EUR
CER (Spotmarket)	0.18 EUR	0.16 EUR	-0.02 EUR
ICE Brent Crude Oil (Benchmark Future)	62.64 USD	63.35 USD	+0.71 USD
EURO (Currency, Forex)	1.11018 USD	1.1051 USD	+0.0033 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

Dear Sir or Madam,

the media hype around Greta Thunberg and the movement “Fridays for Future” seems to be coming to an end and climate protection is just one of many topics. So it is fitting that the warning of 11,000 scientists from 184 countries is not to be found on the front pages of the newspapers on which the climate protection movement had recently found a place.

The joint declaration of the scientists, of which 900 are from Germany, warns of a global climate emergency. At the same time, the scientists have come to the conclusion that the objectives of the Paris Agreement on climate change are not enough to reduce global warming. And here too, only 28 EU states and 7 other countries are on the right track.

At the same time, the scientists warned that there would be untold human suffering insofar as human behaviour on greenhouse gas emissions would not fundamentally change. To achieve this, they are calling for, among other things, the switch to renewable energies, a sustainable change in the world economy, the containment of world population growth and the reduction of animal products.

It is to be hoped that this urgent warning will be a topic at the upcoming World Climate Change Conference in Madrid next month.

Prices for one ton of CO2 emissions have become slightly cheaper in the EU next week. During this trading week, 11,066,500 EUAs will be offered for auction on the Leipzig EEX on four days, which is 5.6 million fewer shares than in the previous week.

(Average Quotes Exchange / OTC)
Instrument	01/11/2019	08/11/2019	Change
EUA (Spotmarket)	25.28 EUR	24.84 EUR	-0.44 EUR
EUA (December-2019-Future)	25.29 EUR	24.84 EUR	-0.45 EUR
CER (Spotmarket)	0.20 EUR	0.18 EUR	-0.18 EUR
ICE Brent Crude Oil (Benchmark Future)	61.52 USD	62.64 USD	+1.12 USD
EURO (Currency, Forex)	1.1165 USD	1.1018 USD	-0.0147 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

Dear Sir or Madam,

Last week, the German Cabinet introduced a law to introduce a national emissions trading scheme for fuels. The aim is to gradually make the burning of fossil fuels for transport and heating more expensive, thus making the switch to climate-friendly alternatives more attractive. In return, the revenues will be refunded to the citizens in the form of reductions in the electricity price, in the commuting allowance and in the housing benefit, or invested in climate protection measures. The law now goes into parliamentary deliberations.

As Federal Environment Minister Svenja Schulze explained in more detail, emissions trading will start in 2021, initially with a fixed CO2 price of 10 euros per tonne. This corresponds gross to 2.8 cents per litre of petrol, 3.2 cents per litre of diesel, 3.2 cents per litre of heating oil and 0.2 cents per kilowatt hour of natural gas. In 2022, the price will then be 20 euros per tonne. 2023 to 2025 the certificates are issued with a rising fixed price (25-35 euro per ton CO2). In 2026, the certificates will be auctioned in a corridor of 35 euros to 60 euros per tonne of CO2. In 2025, the maximum and minimum prices for the period from 2027 onwards will be determined. However, citizens who use fossil fuels for heating or driving do not have to trade certificates themselves. This is the responsibility of the approximately 4000 gas suppliers, refineries and other companies that are subject to energy tax.

In the first five years, this new, national emissions trading scheme will basically act like a tax due to the fixed price and will only become a genuine market instrument from 2026, just as the mandatory European emissions trading scheme has been for a long time, which – after the appropriate political corrective measures – has also proved its worth.

Although the prices now fixed are separate from the ETS, they may provide some indication as to where the European pollution rights journey could lead in the coming trading period.

The fact that the introduction of the new emissions trading scheme in Germany is not really a national solo effort in the narrower sense was also made clear last week in Berlin at the International Carbon Pricing Week. Representatives from more than 50 countries and regions exchanged their experiences with carbon pricing instruments and also discussed new approaches to reducing greenhouse gas emissions. The conference made it clear that the number of countries using either a CO2 trading system or another CO2 levy to achieve climate neutrality is constantly growing.

A look at the well-established ETS shows a continuing uncertainty among market participants for the past trading week, which, among other influences, was caused by the still unresolved issue of Brexit. This strong uncertainty is reflected in a range between the highest and lowest price of a good two euros. This resulted in a price axis of 25.25 EUR. The CO2 market was unable to profit from the sharp rise in oil prices.

(Average Quotes Exchange / OTC)
Instrument	18/10/2019	25/10/2019	Change
EUA (Spotmarket)	25.87 EUR	24.95 EUR	-0.92 EUR
EUA (December-2019-Future)	25.88 EUR	24.97 EUR	-0.91 EUR
CER (Spotmarket)	0.21 EUR	0.20 EUR	-0.01 EUR
ICE Brent Crude Oil (Benchmark Future)	59.29 USD	61.69 USD	+2.40 USD
EURO (Currency, Forex)	1.1169 USD	1.1080 USD	-0.0089 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

Dear Sir or Madam,

Brexit remains the topic on the financial markets and thus also on the courses for European CO2 certificates. The British Parliament forced Boris Johnson on Saturday to ask the EU for a Brexit extension. The EU immediately reached two letters – one requesting an extension of the deadline, which Johnson did not personally sign, and a second, expressing his displeasure at extending the deadline, which included his signature.

The EU will now decide on a deferral until 31.01.2020 by the end of the month. However, the topic will be an important topic at the beginning of the week at the European Parliament. The chances of further British voting on remaining in the EU have also increased, but a decision by the EU to extend the deadline has to be taken. Tens of thousands of British marched at the weekend from London Hyde Park to Parliament and also demanded a referendum again.

Last week’s development in London was viewed positively in the market for CO2 emission rights, and prices for EUA started this morning with more than one percent growth. It remains to be expected that news on political decisions in Brussels and London will continue to influence prices over the coming days.

This week, a total of 15,782,500 EUA will be auctioned on the Leipzig EEX on all five trading days.

(Average Quotes Exchange / OTC)
Instrument	11/10/2019	18/10/2019	Change
EUA (Spotmarket)	24.40 EUR	25.87 EUR	+1.47 EUR
EUA (December-2019-Future)	24.44 EUR	25.88 EUR	+1.44 EUR
CER (Spotmarket)	0.21 EUR	0.21 EUR	+0.00 EUR
ICE Brent Crude Oil (Benchmark Future)	60.60 USD	59.29 USD	-1.31 USD
EURO (Currency, Forex)	1.1043 USD	1.1169 USD	+0.0126 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