(BN) EU Carbon Little Changed After Reaching 10-Day High; Power Rises


EU Carbon Little Changed After Reaching 10-Day High; Power Rises
2011-01-17 11:22:25.594 GMT

By Ewa Krukowska and Mathew Carr
Jan. 17 (Bloomberg) -- European Union carbon-dioxide
permits were little changed after reaching the highest price in
10 days as rising German power and U.K. natural gas prices
boosted demand for emission rights.
Allowances for delivery in December increased less than 0.1
percent to 14.50 euros ($19.26) a metric ton as of 10:40 a.m. on
London's ICE Futures Europe exchange. They gained as much as 1
percent earlier today to 14.63 euros, the highest price since
Jan. 7.
"Power and gas are up," said Carine Hemery, an analyst in
Paris for Orbeo, the emissions-trading venture of Societe
Generale SA and Rhodia SA. Futures rose on Jan. 14 to close
above a "strong resistance" level of 14.41 euros, Hemery said
today in a phone interview.
Power utilities buy carbon permits to match forward sales
of electricity, locking in profits on those deals. They require
twice as many permits when they burn coal instead of cleaner-
burning gas. The benchmark contract for coal this year has
advanced 2.3 percent in the past year.
German electricity for settlement next year rose 0.4
percent to 53 euros a megawatt-hour, according to broker data
compiled by Bloomberg. Higher power prices can boost the
incentive to sell power forward, stimulating purchases of
emission permits. U.K. natural gas for the six months through
September this year, the summer contract, rose 0.6 percent.

For Related News and Information:
Emission market news NI ECREDITS <GO>
Today's top energy stories ETOP <GO>
European power-markets home page EPWR <GO>
Sustainability, environmental indexes SEI <GO>

--Editors: Mike Anderson, John Buckley.

To contact the reporter on this story:
Ewa Krukowska in Brussels +32-2-237-4331 or
Mathew Carr in London at +44-20-7073-3531 or

To contact the editor responsible for this story:
Stephen Voss at +44-20-7073-3520 or sev@bloomberg.net