The CO2 Market – 04.08.2021

The EUA price on London based exchange ICE ECX closed on 03.08.2021 at 54.30 euro/tCO2, reaching above 55 euro in the trade day.

EUA Price Trend

EUA markets have started August on a strong note, trading above 55 €/t as low auction volume and strong complex finally brought the market to react in strength after a strongly under performing July. With the holidays season having started, we expect reduced trading activity in a general bullish environment where next technical resistance target for Dec-21 contracts of EUR 56 to be potentially challenged. If broken, the early July high of 57.9 is the next target.  Strengthening economic signals are confirming this point of view for the time being, however short-term Covid concerns ought not to be discounted from potential harm on European markets.

IEA states that only 2% of governments’ recovery spending is going to clean energy transitions

The new Sustainable Recovery Tracker of the International Energy Agency measure how much clean energy investment is mobilised by the massive economic recovery packages that governments enacted in response to the Covid-19 crisis. The initial findings make clear the need for governments to step up their efforts rapidly.

So far, only about 2% of economic recovery spending has been allocated to clean energy transitions. While it’s understandable that government spending initially went towards public health and immediate economic relief, investment in sustainable energy measures will have to rise dramatically if countries are going to reach their climate targets. Under current government recovery spending plans, global carbon dioxide emissions are set to climb to record levels in 2023 and keep rising in subsequent years.

Source: ICE ECX, London & IEA, Paris