DBLM Solutions

Luciano Magliocco +353 87 9051928 (Mobile) dblmluc (SKYPE) luc@dblmsolutions.com

DBLM Solutions Carbon Update

Carbon Overview

David Boles 01 4433584 (Direct) dblmdavid (SKYPE) david@dblmsolutions.com

At time of writing the Dec '13 EUA Contract was at 4.85. This represents a 55 cents fall off since the start of the the session today. This mornings auction cleared 3,554,000 million EUA's at 4.90 on EEX. The dip in the market seems to be from a political soundbite where a key member of the European People's Party (largest political group in European Parliament) stated that the majority of his party were opposed to temporarily cutting the supply of credits in the EUETS. All will be revealed next Tuesday morning and I will let you know the result as soon as it is declared. At this stage it is fair to say that nobody really knows which way the vote will go. Airlines in Europe that are included in the EUETS for flights within the European bloc have exceeded their free allocation by approximately 30% according to recently published data. For instance, Ryan air, the largest emitter released 7.46 million tonnes of carbon dioxide into the atmosphere, 34% more than their free allocation. The UN offset quotient of 15% will relieve the financial burden of the free allocation shortfall to a certain extent due to the very low cost of ERU's and CER's (10 cents and 6 cents respectively)Ryan air need to go to market for 1.9 million tonnes, of which 1.119 million maybe UN offsets. At current values they will need to pay 3,881,280 for allowances and 119,000 for offsets to be compliant.
Dec 13 EUA

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