Emissions Trading / Carbon Market News (11/04/2022)

Dear Madam or Sir,

The terrible war in Ukraine and the still omnipresent corona pandemic dominates the news, leaving little time for other topics. That is why we are pointing out the climate crisis in particular today, which will continue to develop in the direction of a catastrophe if we do not see Corona and the war in Ukraine and the associated problems with the supply of fossil fuels as an opportunity to immediately set the course towards to decarbonize the world.

From the beginning of industrialization to 2019, humanity released a total of 2,400 gigatonnes of greenhouse gases. In the period from 1850 to 1989, i.e. within 140 years, there were 1,400 gigatonnes of CO2e, i.e. 58% of the total emissions. Over the last three decades from 1990 to 2019, we released the remaining 1,000 gigatonnes of CO2e into the atmosphere. And the last decade sets another, sad record – in the period 2009-2019 it was 410 gigatonnes of CO2e, which is 17% of the emissions between 1850 and 2019.

Last week, the German federal government decided on the course for the reassignment of CO2 pricing in the building sector, which is now to begin in 2023. So far, this has been borne entirely by the heating costs of the tenants, but from next year there will be a phased model that passes the burden on to the landlord in terms of how harmful his building is to the climate.

If an apartment has a poor energy balance of more than 52 kilograms of CO2 per square meter, the landlord now pays 90% and the tenant only 10% of his heating costs. This should then be reduced in up to 10 steps down to 0% for the landlord, insofar as the building complies with the EH55 energy standard or better. In this case, the tenant continues to bear all costs for CO2 pricing in accordance with the Fuel Emissions Trading Act (BEHG).

Germany was the first country in Europe to introduce national emissions trading through BEHG, and the European Union is now toying with the idea of ​​introducing this across the EU in order to ensure that CO2 emissions in the building and transport sectors are priced accordingly in all countries. It will be interesting to see how quickly this will be implemented.

Due to the Easter holidays, there will only be an auction on EEX on four days this week and the following week; in the coming week there will only be three auction dates for EU emission allowances. Accordingly, the prices have now been slightly bullish and closed above the 80-euro-mark on Friday.

  (Average Quotes Exchange / OTC)   
Instrument01/04/2208/04/22Change
EUA (Spot-Market)78.28 EUR80.15 EUR+1.87 EUR
EUA (December-2022-Future)78.49 EUR80.09 EUR+1.60 EUR
VCU (Voluntary Carbon Units ø)10.99 USD11.45 USD+0.46 USD
VER (Gold Standard Spotmarkt ø)6.29 USD5.98 USD-0.31 USD
nEZ (German National Carbon Units)30.00 EUR30.00 EUR+0.00 EUR
ICE Brent Crude Oil (Benchmark Future)104.38 USD102.27 USD-2.11 USD
EURO (Currency, Forex)1.1028 USD1.0875 USD-0.0153 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

Emissions Trading / Carbon Market News (04/04/2022)

Dear Madam or Sir,

Even if Corona paralyzed many areas of public life last year, at least partially, the past year 2021 was the year with the highest ever recorded CO2 emissions in the sector of ​​global energy-related emissions.

In total, the incredible number of 40.8 billion tons of CO2e was emitted. Leading the way was coal at 37% for more than 15 billion tons responsible, followed by oil at 10.7 billion tons (26%) and gas (NG) at 7.5 billion tons, accounting for 18% of global emissions. Methane gas is responsible for 10% or 4 billion tons of greenhouse gas and the remaining 9% is shared by industrial processes, waste and other industrial greenhouse gas generation.

At the end of last week, US President Joe Biden announced the release of one million barrels of oil per day for the next six months, which caused the price of Brent crude oil to fall below the USD 100 mark for a short time and showed a clear minus based on the weekly closing price.

One can only hope that the politicians responsible in the western world, due to the record number of greenhouse gas emissions and the background of the dependence on Russia and the Arab states, have finally understood that there is no alternative to the path to decarbonization of society.

In the past week of trading, the prices for the carbon emission allowances (EUA) of the European emissions trading system EU ETS moved sideways and closed almost unchanged on the basis of the weekly closing price.

A total of 5,575,500 EUAs will be auctioned this week on the Leipzig European Energy Exchange, as well as 600,000 EUAA for aviation, but aircraft operators could also use EUAs, since the price difference is marginal. The auction dates for Germany’s national emissions trading will also take place again this Tuesday and Thursday, with both 2021 and 2022 national emission certificates (nEZ) being able to be purchased.

  (Average Quotes Exchange / OTC)   
Instrument25/03/2201/04/22Change
EUA (Spot-Market)78.31 EUR78.28 EUR-0.03 EUR
EUA (December-2022-Future)78.60 EUR78.49 EUR-0.11 EUR
VCU (Voluntary Carbon Units ø)10.97 USD10.99 USD+0.02 USD
VER (Gold Standard Spotmarkt ø)6.20 USD6.29 USD+0.09 USD
nEZ (German National Carbon Units)30.00 EUR30.00 EUR+0.00 EUR
ICE Brent Crude Oil (Benchmark Future)119.31 USD104.38 USD-14.93 USD
EURO (Currency, Forex)1.0981 USD1.1028 USD+0.0047 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

Emissions Trading / Carbon Market News (28/03/2022)

Dear Madam or Sir,

Russia’s war against Ukraine was also the dominant topic on the financial, energy and commodity markets last week.

Even if you could see it in Germany’s Economics Minister Habeck, he has entered into a long-term energy partnership with Qatar, in particular for the supply of liquefied natural gas (LNG) in the coming years. Qatar is one of the world’s most important producers of liquefied natural gas. And so that at least a slight green can be seen, Habeck emphasized that the agreed partnership not only includes liquid gas, but also the expansion of renewable energies combined with further energy efficiency measures.

The German federal government thus intends to reduce the share of gas from Russia to around 30 percent by the end of 2022. By early April, the Russian share is expected to drop by 15 percent to just 40 percent.

US President Joe Biden, together with EU Commission President Ursula von der Leyen, also announced increased deliveries of liquid gas from the USA to the EU in Brussels. By 2030, Europe should have continued demand for additional LNG of at least 50 billion cubic meters per year from the US, equivalent to a third of the volume of Russian gas currently coming to Europe. US imports are expected to replace a tenth of Russian imports this year. In addition to the USA, the EU Commission is also negotiating with Qatar, South Korea, Azerbaijan and Japan.

In order to diversify supplies, the EU Commission is also in contact with countries such as Qatar, Azerbaijan, Japan and South Korea. The federal government wants to reduce the share of Russian gas in Germany to about 30 percent by the end of the year. By the end of this month, the share should be only 40 percent instead of the previous 55 percent.

With a view to the approaching end of the submission deadline at the end of the 17th calendar week, EU emission allowances could show bullish tendencies again, especially if there are signs of relaxation in Ukraine. From this point of view, it may be advisable to obtain at least some of the certificates that are still to be obtained for the compliance portfolio.

This week, regular auctions for a total of 12,786,000 EUAs will take place at EEX on all five working days.

  (Average Quotes Exchange / OTC)   
Instrument18/03/2225/03/22Change
EUA (Spot-Market)78.84 EUR78.31 EUR-0.53 EUR
EUA (December-2022-Future)78.89 EUR78.60 EUR-0.29 EUR
VCU (Voluntary Carbon Units ø)8.42 USD8.95 USD+0.53 USD
VER (Gold Standard Spotmarkt ø)8.00 USD8.54 USD+0.54 USD
nEZ (German National Carbon Units)30.00 EUR30.00 EUR+0.00 EUR
ICE Brent Crude Oil (Benchmark Future)108.21 USD119.31 USD+11.10 USD
EURO (Currency, Forex)1.1091 USD1.0981 USD-0.0110 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. VCUs and VERs are average prices (CBL markets). 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

Emissions Trading / Carbon Market News (21/03/2022)

Dear Madam or Sir,

The Federal Environment Agency, together with the Federal Ministry for Economic Affairs and Climate Protection, has issued a press release on the development of greenhouse gas emissions in Germany in 2021. All in all, the figures show that after a strong decline in 2020, emissions rose again significantly, by a good 33 million tonnes or 4.5 percent.

The rise is particularly noticeable in the energy sector: This shows a plus of 27 million tonnes of CO2-equivalents, as more coal was used for electricity generation due to increased electricity demand, lower electricity generation from renewable energies and the higher price of gas. Electricity generation from renewables fell by seven per cent, mainly due to poor wind conditions.

German State Secretary for Climate Patrick Graichen commented: “The rise in greenhouse gas emissions has unfortunately been on the horizon. The German government will now quickly counteract this with an immediate climate protection programme. The key is a much faster pace in the expansion of renewable energies. We must manage to install three times as much capacity as before in order to increase the share of renewables in electricity generation to 80 percent by 2030. There must be no more of the kind of deadlock that we have seen in recent years. The Russian war of aggression on Ukraine has also made it dramatically clear to us how closely security and energy supply are linked. … The faster transition away from fossil energies must encompass all areas – from industrial production and buildings to mobility and agriculture. The decisive factor here is to maintain the social balance.”

Since 1990, emissions in Germany have thus fallen by only 38.7 percent. The target for 2030 is a minus of 65 percent. The available data show that since 2010, the energy turnaround in particular has contributed to the reduction of emissions. All other significant sectors have more or less stagnated since 2010. As a meeting of EU environment ministers last Thursday showed, a growing number of EU member states are willing to support a second emissions trading system for buildings and transport.

European pollution allowances saw a significant sideways movement in a range of 76 – 80 euros during the past trading week. At the end of the week, EUAs were even traded in their narrowest weekly range since the end of 2021, as the 80-euro mark apparently acted like a magnet and at the same time represented a stable technical resistance.

  (Average Quotes Exchange / OTC)   
Instrument11/03/2218/03/22Change
EUA (Spot-Market)76.38 EUR78.84 EUR+2.46 EUR
EUA (December-2022-Future)76.39 EUR78.89 EUR+2.50 EUR
VCU (Voluntary Carbon Units ø)7.32 USD8.42 USD+1.10 USD
VER (Gold Standard Spotmarkt ø)9.32 USD8.00 USD-1.32 USD
nEZ (German National Carbon Units)30.00 EUR30.00 EUR+0.00 EUR
ICE Brent Crude Oil (Benchmark Future)112.40 USD108.21 USD-4.19 USD
EURO (Currency, Forex)1.0912 USD1.1091 USD+0.0179 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. VCUs and VERs are average prices (CBL markets). 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

Emissions Trading / Carbon Market News (14/03/2022)

Dear Madam or Sir,

The war in Ukraine was the dominant topic on the international financial and commodity markets last week.

Due to the high oil price in connection with the weakening euro, this also has a direct impact on consumers worldwide. However, the markets seem to have digested the first shock and have clearly moved away from the highs of the past few days.

A typical counter-movement could also be seen in the case of CO2 certificates, which have visibly recovered from the lows of EUR 55 in the previous week.

In the past week, prices rose again towards the 80 euro mark and were able to exceed this shortly after the start of trading today.

Also in the new trading week, the war in Ukraine will remain the market movement on the financial, energy and commodity markets.

If the situation in Ukraine eases, the approaching end of the submission deadline for emission allowances on April 30, 2022 will again come into the focus of market participants and could cause prices to rise to the level before the Russian invasion of Ukraine.

  (Average Quotes Exchange / OTC)   
Instrument04/03/2211/03/22Change
EUA (Spot-Market)65.48 EUR76.38 EUR+10.30 EUR
EUA (December-2022-Future)65.10 EUR76.39 EUR+11.29 EUR
VCU (Voluntary Carbon Units ø)5.45 USD7.32 USD+1.87 USD
VER (Gold Standard Spotmarkt ø)9.84 USD9.32 USD-0.52 USD
nEZ (German National Carbon Units)30.00 EUR30.00 EUR+0.00 EUR
ICE Brent Crude Oil (Benchmark Future)118.03 USD112.40 USD-5.63 USD
EURO (Currency, Forex)1.0931 USD1.0912 USD-0.0019 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. VCUs and VERs are average prices (CBL markets). 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