Issue CCXXII

Carbon Newsletter

DBLM Solutions
26 Nov 2015

The EUA Dec14 contract is currently at 8.63.

Weekly
Recap

ICE
EUA
Spot

ICE CER
Spot

ICE
EUA
Dec15

ICE CER
Dec15

19/11/2015

8.63

0.67

8.63

0.65

20/11/2015

8.53

0.67

8.51

0.66

23/11/2015

8.56

0.67

8.57

0.66

24/11/2015

8.65

0.64

8.64

0.63

25/11/2015

8.61

0.62

8.63

0.62

Volumes lots

3,211

486

62,626

1,145

-2.31%

-7.46%

-4.61%

Week %

The EUA/CER spread increased this week at 7.99,

at close of business last night versus the 7.89
spread we witnessed last week and 7.76 the week
before.

Auctions
EEX held auctions last Thursday, Friday & Mon,
Tuesday & Wednesday. Auction prices were
8.57, 8.59, 8.46 & 8.63 respectively. The
cover ratios for the above auctions were 3.26, 2.47,
2.34 & 3.74 respectively. (Cover Ratio = Number
of bids/Auction Volume)

The Linear reduction factor for free allocations will

increase from its current rate (1.74%) to 2.2% a
year during the decade to 2030. In laymans terms
this translates to a 2.2% reduction in free
allowances in the decade to 2030 for
manufacturerers. All in all, the cap will be reduced
by 43% since its inception in 2005.
So, for participants interested in determining their
free allocation moving forward. The free allocation
equation = Benchmark x historical activity level x
carbon leakage exposure factor x cross-sectoral
correction factor. Supply snapshot illustrated
below.

Post 2020 Cap

The composition of the cap is illustrated below and
will exhibit the following compoment by 2030.

The contents of the Newsletter is not a recommendation, either implicit or explicit, to buy or sell emission permits.
Contact: David Boles, Compliance Markets -Direct: +3531 4433 584; Mob: +353 831747707
DBLM Solutions is partly funded by the Wicklow Enterprise Board.