Robin Lancaster: How much of a concern to exchanges are the low carbon prices for EU and UN carbon?
Tobias Pantenburg: Generally, the price doesn’t make a difference for exchanges. The low prices in the carbon market however go along with low liquidity, which makes selling sometimes difficult. The problem for our traders is that the oversupply in the market caused the low prices, which makes it needless to buy and uncomely to sell.
 
RL: Has there been sufficient tightening of regulation to avoid future scandals in the market, such as VAT fraud and allowance theft?
TP: The measures to avoid VAT fraud like no VAT charge or reverse charge have been rolled out in almost every country. The measures to prevent theft, like the union registry or the concealing of serial numbers are the right steps and will make the market secure as soon as they are installed. We as an exchange trust and rely on the KYC (know your customer) process of our Clearing Banks, who illuminate the integrity and purity of the company and money respectively.
 
RL: How important is the increased level of auctioning in phase III of the EU ETS?
TP: The auction has been and will remain an important distribution platform of new EUAs for about a dozen of companies. For most market participants it is much easier and reliable to keep buying on the continuous market, where prices are known. The prices between the auction and the exchange have been the same, so that there is no distortion or disadvantage.
 
RL: If you are bidding to be part of the auctioning in phase III when do you hope to hear if your tender has been successful or not?
TP: After the price and the amount of EUAs have been calculated, it is imperative to inform every bidder (successful or not successful) immediately about the outcome of the auction. Otherwise in any delay the bidder faces an additional market risk.
 
RL: In relation to Q4, if you are successful, how soon would you be ready to take part in an auction?
TP: An auctioning platform technically is one of the easy parts in the trading system of an exchange. The time consuming point is to fill the application as detailed as possible and many points considers regulation and legal affairs.
 
RL: Will aviation's entry into the EU market bring much liquidity to the market?
TP: Yes, every airline seems to be short. The additional demand in EUAs displays a natural balance to the oversupply out of the past. We will see, if the trading strategy of the airlines will be rather an industrial back-to-back purchase at the spot market or a hedging strategy at the futures market.
 
RL: Do you see opportunities in other carbon market jurisdictions, such as California, Quebec or Australia?
TP: The linkage between several trading schemes has been the hope from the beginning of the EU ETS. If this hope becomes a business opportunity will be judged rather by traders than by lawyers.
 
RL: What new products/services could still be added to the market?
TP: The private sector plays an important role in the financial services. It would add sources to the system instead of splitting liquidity into other sectoral credits. Nama bonds could become particularly interesting for an exchange that also offers a stock market.
 
RL: Are you seeing any impact from the plans to tighten financial regulation in Europe and North America?
TP: The implementation of regulation like MIFiD and/or EMIR is necessary. It would bring more transparency and security in the market, which is required to make this market trustworthy again. By the way, the emissions market is comparable to the Foreign Exchange Market, where a central bank regulates not only the amount of money but also the interest rates.

Contents:

• CO2 Market Development
• COP17: The Durban Package
• Spot Carbon Market to be included in MiFID
• Aviation to be included in EU ETS, despite international opposition
• Glossary

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Table of Contents:

• Introduction
• Principles of free allocation
• Selected benchmarks and their impact on sectors
• Auctioning of emissions allowances
• Effects of allocation rules on the certificate market
• EU Effort Sharing

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Bisher gibt es keine EU-weite Regelung für die Versteigerung von Emissionszertifikaten. Dies soll sich mit der neuen EU-Versteigerungsverordnung nun ändern. Die Kompetenz der EU zum Erlass dieser Verordnung ergibt sich primär aus Art. 192, 191 AEUV. Hiernach kann die EU-Kommission umweltpolitische Maßnahmen zum Schutz des Klimas veranlassen. Daraufhin wurde die EU-Kommission ermächtigt, das Verfahren zur Versteigerung von Zertifikaten für ortsfeste Anlagen und für den Luftverkehr in einer Verordnung zu regeln.

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Der Preis für Emissionsberechtigungen im EU-Emissionshandelssystem ist ein Indikator dafür, wann Minderungsmaßnahmen im Unternehmen wirtschaftlich sind.  Lesen Sie, wie Unternehmen vorgehen sollten, um Emissionsminderungsmaßnahmen zu definieren und durchzuführen, und wie der CO2-Handel einen Beitrag zur Finanzierung leistet. Erfahren Sie mehr über die Einflussfaktoren auf den EUA-Preis und die Preisprognosen verschiedener Institute.

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