The CO2 Market – 13.07.2021

The EUA price on London based exchange ICE ECX opened on 13.07.2021 at 51.68 euro/tCO2, as gas and power markets turned lower and traders looked ahead to Wednesday’s, 14.07., unveiling of EU ETS reform proposals.

Brussels plans inclusion of int’l shipping in EU ETS from 2023, price curbs for transport and buildings -draft

The European Commission is planning carbon market reform proposals that would adjust downwards the scheme’s annual cap cut earlier than originally foreseen. The EU’s upcoming carbon market reform proposal will seek to place further conditions on free allowance allocation to energy-intensive industries, according to sources familiar with the draft document.

The  Commission is also planning to bring international shipping into the EU ETS from 2023, with a transition period ramping up emissions coverage for the sector thereafter, according to a leaked draft, which also outlines measures to contain price spikes in a separate trading system for buildings and transport.

German energy exchange launches zero-carbon shipping index

German energy bourse EEX on Monday, 12.07.2021, launched a Zero Carbon Freight Index that it said will allow players in the dry freight market to measure how carbon costs will affect them.

French govt advisors suggest creation of EU carbon central bank

Several economic advisors to the French government have suggested an EU carbon central bank as an alternative to a price corridor to manage long-term carbon cost stability, according to a paper released on Friday.

Europe’s ‘Fit for 55’ climate package: What to expect

The package consists of 13 legislative proposals – some new and others revisions of existing laws. Here’s what to expect:

Updates to existing EU laws:

·       Revision of the EU emission trading scheme (EU ETS)

·       Revision of the regulation on land use, land use change and forestry (LULUCF)

·       Revision of the effort sharing regulation (ESR)

·       Amendment to the renewable energy directive (RED)

·       Amendment to the energy efficiency directive (EED)

·       Revision of the alternative fuels infrastructure directive (AFID)

·       Amendment of the regulation setting CO2 emission standards for cars and vans

·       Revision of the energy taxation directive

New legislative proposals:

·       New EU forest strategy

·       A carbon border adjustment mechanism (CBAM)

·       A Climate Action Social Facility

·       ReFuelEU Aviation – on sustainable aviation fuels

·       FuelEU Maritime – on greening Europe’s maritime space

Source: The European Commission, Brussels; Carbon Pulse and Energy in Demand, London