(BN) Barclays Cuts Forecast for UN Emission Prices This Year by 10%


Barclays Cuts Forecast for UN Emission Prices This Year by 10%
2011-01-10 16:27:38.248 GMT

By Mathew Carr
Jan. 10 (Bloomberg) -- Barclays Plc cut its forecast for
United Nations carbon prices in the first half of 2011, citing a
higher-than-expected supply of new credits.
UN prices will average 13 euros ($16.82) a metric ton in
the six months, less than a previous forecast for 14.50 euros,
Trevor Sikorski, a London-based analyst at Barclays Capital,
said today in an e-mailed report.
The supply of UN credits rose 8.2 percent last year to 132
million tons, Sikorski said. China had 69 percent, higher than
the 60 percent in 2009, he said. Power stations and factories in
the European Union can use UN credits for compliance in the EU
program, the world's largest carbon market.
UN Certified Emission Reduction credits for December fell
2.9 percent today to 10.91 euros a ton, the lowest level since
March 25, according to data from ICE Futures Europe exchange.
EU regulators are considering restrictions on UN emission
credits linked to industrial gases.
The European Commission, regulator for the 27-nation bloc,
proposed Nov. 25 to exclude UN-sponsored credits related to
industrial gases including hydrofluorocarbons and nitrous oxide
starting in 2013. The commission said the credits may create
windfall profits for investors and undermine the EU market.

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--Editors: Mike Anderson, Randall Hackley.

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