(BN) AAU Carbon Permit Prices May Plunge Next Year, AES Official Says


AAU Carbon Permit Prices May Plunge Next Year, AES Official Says
2010-11-11 07:30:00.0 GMT

By Mathew Carr
Nov. 11 (Bloomberg) -- The price of Assigned Amount Units
may plunge next year as nations with surpluses scramble to sell
the emission permits, said an official at AES Corp., the U.S.
power producer with operations in 29 countries.
Prices of the allowances known as AAUs, given to developed
nations with targets under the 1997 Kyoto Protocol, may drop to
a range of 3 euros to 6 euros ($4.13-$8.26) a metric ton next
year from current prices around 7 euros to 9 euros, said David
Ungar, managing director of Virginia-based AES's European and
African climate solutions unit.
"There's going to be a declining trend," Ungar said in an
interview yesterday at the Climate Finance 2010 conference in
London. Nations may decide to sell without seeking to use the
funds for environmental projects because they got generous
limits in the 1990s to entice them into the program, he said.
There may be 9 billion metric tons of spare AAUs in the five
years through 2012, the period with Kyoto targets, he said.

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