close at 61 would be widest ever...that's current price
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UN Emission Credits Match Widest-Ever Spread Between 2011, 2010
2010-08-26 17:14:43.129 GMT
By Catherine Airlie and Mathew Carr
Aug. 26 (Bloomberg) -- The spread between United Nations
emission offsets for 2010 and 2011 matched their widest-ever
level as regulators restrict the supply of new credits.
The premium of 2010 UN Certified Emission Reduction credits
over the same contract for 2011 rose 10 cents, or 20 percent, to
60 euro cents ($0.76) a metric ton today on the European Climate
Exchange in London. European Union allowances for December fell
0.9 percent to 15.25 euros.
Regulators of the UN's Clean Development Mechanism, the
world's second-largest carbon market, are boosting scrutiny
after allegations that some developers are seeking excessive
credits from plants that cut hydrofluorocarbon-23 gases, whose
warming potential is 11,700 times more powerful than carbon
dioxide. They are assessing whether the methodology for awarding
those offsets should be changed.
"The recent HFC developments mean heavy CER supply cuts
that are not yet priced in completely," said Emmanuel Fages, a
Paris-based analyst with Orbeo, the carbon-trading venture of
Societe Generale SA and Rhodia SA. Potential restrictions on use
of HFC credits in the European Union may drive 2012 CERs lower,
he said.
"The long-term view of investors in the CER market changed
from confidence to reluctance over the past year," Marius
Frunza of Sagacarbon, a unit of Caisse des Depots et
Consignations in Paris, said today by e-mail. "The
backwardation structure will not reverse soon."
For Related News and Information:
Emissions-trading stories: NI ENVMARKET BN <GO>
Today's top energy news: ETOP <GO>
European power-markets home page: EPWR <GO>
--With assistance from Ewa Krukowska in Brussels. Editor: Mike
Anderson.
To contact the reporter on this story:
Mathew Carr in London at +44-20-7073-3531 or
m.carr@bloomberg.net;
Catherine Airlie in London at +44-20-7073-3308 or
cairlie@bloomberg.net
To contact the editor responsible for this story:
Stephen Voss at +44-20-7073-3520 or sev@bloomberg.net
