Interest in EU carbon credits strong, but not on exchanges

SBB 11 February Most European carbon credit exchanges have not resumed spot trading and volumes remain low, Steel Business Briefing learns. However, interest at a UK auction yesterday was higher than last month. Interest was 6.77 times higher than available volumes at a UK auction of EUAs yesterday, up from the last UK auction in January. EUAs were cleared at €14.36/t ($19.52/t), up from €14/t a month ago.

Spot trading ended on 19 January when transfers of credits held by national registries was stopped by the European Commission. The move came after a number of hacking attacks on the registries and some thefts of credits.

The Paris-based BlueNext exchange remains the only major European exchange to trade spot European Union Allowances (EUAs). Traded volumes have been negligible since trading resumed a week ago, Carine Hemery, from carbon market analysts Orbeo, tells SBB. Traders are concerned that they may inadvertently buy stolen credits which could be confiscated without compensation.

The credits in the UK auction have not previously been traded and their origin is not in question. This suggests spot trading of EUAs could see higher volumes if traders regain confidence in the security of the market, Hemery suggests.

The French, German, Dutch, Slovakian and UK registries opened on 4 February, as previously reported. The Portuguese registry opens today and several more could reopen next week, SBB learns from the European Commission.


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