DBLM Solutions

David Boles 01 4433584 (Direct) dblmdavid (SKYPE) david@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 4.05. The last week has seen carbon prices fall by 6%, returning to levels pre the European Parliament backloading vote. The price has become very flat, waiting for the next price signal. This mornings auction on EEX of 3,461,500 EUA's went off without a hitch. Demand at the auction was above average with a cover ratio of 3.03. (cover ratio = no. of bids/actual volume). Significant news from Australia indicates that Kevin Rudd is preparing to move towards a carbon cap and trade sooner than anticipated. The Australian carbon floating price is to be brought forward by a year .to 2014. Australia's carbon price started in July 2012 as a carbon tax and was levied at A $23. This month it rose to A$24.15 and was scheduled to rise to A$25.14 in July 2014. The tax on emissions covered approximately 300 power producers and heavy industry across the continent. This may bode well for the proposed link between the EUETS and the Australian cap and trade, schedulled for 2015, affording more time to get all the ducks in a row. At this stage, the above changes are speculative as a change in legislation is required, but thge path has been taken.
Dec 13 EUA

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