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EU Carbon Prices Drift In December

| Sourced From Aviationweek |

European Union emissions allowance (EUA) prices drifted further in December to end the year on a weak note as buy-side support dried up.

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  • Published: Sep 17th, 2010
  • Category: Europe
  • Comments: 7

Analysis: EU Q4 carbon price set to peak at 18 eur/t

(Reuters) – European Union carbon prices are likely to peak at 18 euros ($22.84) a tonne in the fourth quarter, analysts say, frustrating clean energy development.

EUAs traded in the range of 12 to 16 euros this year, peaking at 16.73 euros in May and now trading around 15.40, only two years after reaching an all-time high of 30 euros.

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Point Carbon lowers EUA forecast

| Sourced From |

News and market analysis provider Point Carbon has lowered its price forecast for European Union Emissions Allowances (EUAs) for 2013 by

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  • Author:
  • Published: Jul 7th, 2009
  • Category: Europe
  • Comments: 1

EU carbon prices slip below 13 euros a tonne

LONDON, July 7 (Reuters) – Prices for European carbon emissions permits slipped below 13 euros a tonne on Tuesday but lacked clear direction, traders said.

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Polish Power Exchange joins Nasdaq OMX carbon market; signs for tech

| Sourced From |

The Nasdaq OMX Group (NASDAQ:NDAQ) announces that Nasdaq OMX has expanded its cooperation with the Polish Power Exchange, Towarowa GieĊ‚da Energii (TGE).

TGE has signed agreements for joining the NASDAQ OMX carbon market and extended its trading technology agreement with NASDAQ OMX.

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EU carbon climbs to new four-month high

| Sourced From Reuters |

LONDON (Reuters) – European carbon emissions futures climbed to a new four-month high on Friday, tracking crude oil gains and pushing through a key resistance level of 15 euros, traders said.

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  • Published: Apr 15th, 2009
  • Category: Global
  • Comments: 1

Buy carbon credits cheap, invest in technology

| Sourced From |

LONDON: Intensive energy consuming industries as steel, aluminium, cement and paper industries will have to invest in emission-reduction technologies to offset expected increase in power cost and the need to abide by mandate on emission reductions.

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Poland may get CO2 permits from EU mid-April: source

WARSAW (Reuters) – Poland may receive long-awaited permits for its 2008 carbon dioxide emissions around the middle of next month, a source close to the matter said on Monday.

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EU carbon price to drop further by year-end

LONDON (Reuters) – European carbon emissions will continue to be volatile to the end of the year, with prices expected to tighten to 13 euros or lower if industrial output figures and the economic newsflow do not improve.

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Preparing Industry for the Austrian Government Auction

Auctioning is becoming more and more relevant as a national allocation method within the EU ETS. Germany has announced it will be auctioning 40 million EUAs at the latest from 2010 on. The UK will auction its first volume mid November and Austria is planning to auction the 2008 EUAs early December.
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European Climate Exchange Monthly Report & Exchange Monthly Volume – October 2008


* ECX October volumes reached a total of 412 Mt, exceeding the previous monthly record from July 2008 (346 Mt) and representing a 283% increase over the same month last year.

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Global Recession Reaches Carbon Market – EU ETS Shortfall To Drop By 44% Due To Recession, Says IDEAcarbon

The global economic recession will have a significant effect on the European carbon market, nearly halving the shortfall in EU Allowances (EUAs), according to a new projection in the latest weekly report from IDEAcarbon, a leading carbon market analysis and research firm.
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Carbon heads down in face of recession

Carbon has collapsed nearly

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Carbon News Roundup Sept 18

OK. I am beginning today with some top stories which you won’t want to miss even if you are in a hurry. These will be followed with the usual stories for each region. I have tried to include news from the last 2 days so that you don’t miss anything. So let’s begin:

Top Stories

Japan CO2 trial to woo emitters with voluntary curbs
Reuters UK
Japan’s planned CO2 trading scheme should be based on voluntary targets for emission cuts instead of mandatory ones to …

New York scheduled to join December carbon auction
New York state is expected to sell carbon credits in the United States’ second greenhouse gas auction, which is scheduled for …

USA: ULCOS,Not ArcelorMittal Considering EUR300M CO2 Proj
Trading Markets (press release),

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Carbon Credit Prices to Rise Due to a Fall in Supply

Reports indicate that the United Nations Environment Program (UNEP) has revised its estimates for the supply of Certified Emission Reductions (CERs). It had previously expected to issue 1.51 billion CERs

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UK: 7% EUAs on Auction in Phase II, Applications Invited

The British government confirmed today that only 7% of the European Union Allowances (EUAs) will be auctioned. A previous analysis hypothesized that the government may auction around 10% of the allowances, which is the maximum allowed by EU regulations. The analysis was based on reports that the additional auction might be used instead of a windfall tax to cut some profits from energy firms and use them on the fuel-poor people.

UK 7% EUA Auction

However, the Aug 15 Defra press release confirmed 7% allowances would be auctioned, amounting to about 85 million allowances during phase II (2008-2012). The exact number of allowances available in each auction would be officially announced by the Treasury at least one month prior to the auction date. Around 23 million tons of carbon permits are expected to be auctioned in 2008 although the date of the first auction has not been set yet.

Complete details of the emissions scheme can be viewed here (PDF) and eligibility criteria for participation in the auction can be read here.

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Prices of EU Permits Stay Constant

After three months of rising steadily in April, May and June, EU permit prices slumped in July and then recovered somewhat in the first week of August. Bloomberg reports that the prices of EU carbon allowances didn’t change too much this week after the economy contracted and RWE’s decision to purchase more EUAs for its UK operations. EUAs for December reached USD 35.37/metric ton, an increase by 8 cents and CER prices dropped to USD 29.05

Prices of EU Permits Stay Constant

The EU economy, which is a global leader in greenhouse gas trading slackened for the first time in its second quarter – the GDP fell by 0.2 per cent as compared to the first quarter as a result of slowing down of major EU countries.

Also, the UK unit of RWE, Germany’s second biggest power generator announced that it will need to purchase more EUAs than expected because it will be using a greater amount of coal than previously thought.

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EU-UN Carbon Link to Go Live in October, CER Prices Rise

We reported yesterday that the software linking the carbon trading schemes of the EU and United Nations will be ready before December, but now there seems to be greater certainty about the timing. The EU’s Executive Commission is looking at the first half of October to connect its carbon trading registry with that of the UN. Timing is of essence because 1 December 2008 marks the date for settlement of CER contracts and failure to get the link working by then will lead to defaults on contracts.

The link was supposed to go live eighteen months ago and the delay coupled with uncertainty about its status had created anxiety among the carbon traders. But now that there is greater clarity, market confidence seems to have been restored somewhat, which has manifested in higher CER prices – they increased by five per cent. Bloomberg reoprts that the prices of EU carbon permits for December have also shot up by 4.4 per cent to reach their highest in a week at $35.95 on the ECX.

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INTERVIEW: Carbon Retirement – Co-Founder Dan Lewer

We recently caught up with Dan Lewer, the Co-Founder of the recently launched Carbon Retirement.

So what is your company all about?

Carbon Retirement was founded in 2008 by me and two colleagues. We wanted to offer a service focused on emission reductions. While we could see that there have been lots of interesting innovations in the voluntary market, we felt that it’s often difficult to evaluate the environmental benefits of offsetting projects. Retirement of allowances from EU Emission Trading Scheme – which is what we do – is a process that delivers unambiguous reductions in carbon emissions and we wanted to give everyone the opportunity to do it. We started taking orders in July this year.

How is Carbon Retirement different to other types of offsetting?

Existing types of offsetting work by investing in projects in the developing world that reduce emissions or absorb greenhouse gas from the atmosphere. Typical projects include tree planting and building renewable energy generators. Carbon Retirement is a fundamentally different approach – it works by buying heavy industry’s rights to release carbon dioxide.

What is the EU Emission Trading Scheme?

It’s a system that European governments use to support their commitments to reduce greenhouse gas emissions. It limits carbon dioxide emissions from a range of industries, including power generation, offshore extraction, cement production, iron and steel, paper and pulp and chemical processing. The EU Emission Trading Scheme is the world’s largest cap-and-trade scheme. In a cap-and-trade scheme, an authority allocates a fixed number of pollution permits to the participants. Each permit is a right to release pollution (in the EU Trading Scheme, each is the right to release one tonne of CO2). Permits can be traded between the participants. This creates a market in permits and a market price.

How is the price calculated?

One of our key principles is to be transparent about where our customers’ money goes. The price we charge is based on the market price of EUAs. For customers using our website, we add an admin fee of 10% (which pays the company’s overheads) and a ‘spread fee’ of 5%. The spread fee covers the risk of the price moving upward between the order being made and Carbon Retirement purchasing EUAs. If the price goes down, we reserve the surplus for retirement of further EUAs. This breakdown is published on our website. For organisations that are thinking about retiring more than a couple of tonnes, the price would work differently.

Why does the price of EUAs change?

Fundamentally, the market price of EUAs is determined by the perceived cost of complying with the reduction required by the EU Trading Scheme. During trading, the market participants’ views of the cost of achieving the reduction can change, which is why the EUA price changes. Energy markets are important drivers. When demand for energy is high, demand for EUAs to cover the generation rises too. Burning coal produces particularly large quantities of greenhouse gases, so the price of EUAs is sensitive to demand for coal.

Where do you buy EUAs from?

From an exchange, a market broker or a regulated participant in the market. EUAs are freely tradable between market participants, so the source of an EUA does not affect the environmental benefits of retiring it.

Project-based offsets often have social benefits. Are there any social benefits to taking EUAs out of circulation?

We don’t think we’re fence-sitting here by saying sort of. We facilitate emission reductions in Europe, and we’re dealing with major energy-intensive industries, so there’s less opportunity for helping out communities at the same time.

The social benefits of offsetting projects can be hard to measure and we need to remember that our aim here is to reduce emissions. Globally, emission reduction and mitigation of climate change will have plenty of social benefits. We’re focused on making sure the emission reductions happen.

How does your calculator work?

Our website gives individuals the option of calculating the emissions associated with flights, driving or other activities, and then retiring a corresponding number of allowances.

Once data has been entered into the calculator, we multiply it by emissions factors. For example, if you input that you have driven a certain number of miles in a large petrol car, we multiply that distance by a factor showing the greenhouse gases released for each mile.

The factors and methodology behind the calculator follow the UK government’s guidelines for calculating a carbon footprint.

Where can I go to find out more about climate change and the EU Emission Trading Scheme?

For the trading scheme, I’d recommend the European Commission’s website. There’s also a straightforward overview on Carbon Retirement‘s site. There is a wealth of information about climate change out there. The BBC’s website is a pretty good place to start.

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EUA Prices Plummet in July

The upward price trend of the EU Emission Trading Scheme (EU ETS) credits or the European Union Allowances (EUAs) over the last three months has been reversed as prices came tumbling down in July. The carbon market to a great extent is contingent upon the fuel prices – the EUA prices rose steadily in April, May and June as more and more power generators were compelled to switch to coal in the face of rising gas prices. Since coal’s carbon emissions are higher than that of gas, an increase in the usage of coal led to a greater demand and hence price of EUAs.

But now with price of gas going down and coal becoming more expensive, the former has become the preferred fuel which has caused EUA prices to go down as it is a cleaner fuel. The rise in their supply as a result of France issuing 130 million EUAs may have also acted as a contributory factor.

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