comments our way...would the EU market move on a ban?
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Mathew Carr, emissions markets, energy reporter. London Bloomberg News ph +44 207 073 3531 yahoo ID carr_mathew
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Ban on HFC Offsets May Not Help Lift EU Carbon, New Energy Says
2010-11-23 08:18:05.755 GMT
By Mathew Carr
Nov. 23 (Bloomberg) -- A ban on some industrial-gas offsets
may not do much to boost European Union carbon prices because
supply is forecast to exceed demand that will come mainly from
power utilities, analysts at Bloomberg New Energy Finance said.
Assuming a ban is introduced in 2013, supply from auctions
and Certified Emission Reductions from the United Nations would
average 82 million metric tons a month in that year, compared
with average demand of 78 million tons a month, London-based
analysts including Clemens Tummeltshammer said yesterday by e-
mail. With no ban in place, supply would rise by 8 million tons
a month to an average of 90 million tons.
The accumulated oversupply in the EU market would reach 246
million tons by the end of 2014 assuming industrial-gas credits
are restricted, the analysis shows. The surplus will be higher
with no ban, according to New Energy Finance's carbon model,
which considers supply and demand in the traded market including
utility buying to match forward-sales of power.
The EU is giving away about 97 percent of allowances in the
five years through 2012, according to figures from Deutsche Bank
AG. The European Commission, regulator for the 27-nation bloc,
is considering exclusion of UN-sponsored credits related to
industrial gases including hydrofluorocarbons and nitrous oxide
starting in 2013.
The EU wants to present its proposal to member states "as
soon as possible," Climate Commissioner Connie Hedegaard said
Nov. 19.
Assuming there is a ban on some UN offsets, EU carbon
permits may jump to 24 euros ($33) a metric ton by 2013,
Emmanuel Fages, an analyst for Orbeo in Paris, said in an Oct.
25 research note. Orbeo is the carbon venture of Rhodia SA and
Societe Generale SA.
Carbon for December 2013 traded yesterday at 16.98 euros a
ton, up 1.1 percent on the ICE Futures Europe exchange in
London. That was its highest price since Oct. 27. Prices for
2013 may be 17 euros a ton, assuming the bloc doesn't limit
offsets or change its 2020 emissions target, which aims for a 20
percent reduction from 1990 levels, Fages said.
For Related News and Information:
Top Power Stories: PTOP <GO>
For New Energy Finance Model, Weekly Research CARX <GO>
Emissions-trading stories: NI ENVMARKET BN <GO>
Today's top energy news: ETOP <GO>
European power-markets home page: EPWR <GO>
--Editors: Mike Anderson, Randall Hackley.
To contact the reporter on this story:
Mathew Carr in London at +44-20-7073-3531 or
m.carr@bloomberg.net
To contact the editor responsible for this story:
Stephen Voss on +44-20-7073-3520 or sev@bloomberg.net
