Value of global CO2 markets up 9 pct to $53 bln in 2015: report

by Reuters
Monday, 11 January 2016 14:00 GMT

Figure pushed higher by soaring value of carbon trading in North America which rose 220 percent

  • North American market value soars 220 pct
  • European CO2 market value/volumes fell in 2015
  • Global market value to rise 25 pct in 2016 to 60 bln euros

LONDON, Jan 11 (Reuters) - The value of global markets for carbon dioxide (CO2) allowances rose by 9 percent last year to 48.4 billion euros ($52.74 billion) and is expected to climb again in 2016, analysts at Thomson Reuters Point Carbon said on Monday.

The overall figure was pushed higher by the soaring value of carbon trading in North America which rose 220 percent to 10.6 billion euros in 2015 compared with 2014, as the region's WCI (Western Climate Initiative) scheme expanded its scope to include transport fuel emissions, the analysts said in a report.

Partners of the WCI include California, Quebec, Manitoba, British Columbia and Ontario.

Volumes traded in North America rose 121 percent to 1.042 billion tonnes of CO2, the analysts said, helping to offset a fall in volumes in Europe's Emissions Trading System (ETS), the world's largest carbon market.

Traded volumes in the EU ETS fell 29 percent in 2015 to around 5 billion tonnes, the analysts said, partly due to government intervention reducing the number of permits available.

In 2014 the European Commission started a process known as backloading to cut the amount of carbon permits to be auctioned by governments in an attempt to reduce the oversupply of permits which has depressed prices. 

Meanwhile less volatile prices also led to a reduction in the number of speculative traders in the European market, the analysts said.

Prices in the EU ETS rose around 11 percent during 2015 but due to the slump in traded volumes the market's overall value dropped by 8 percent to 37.5 billion euros, they said.

Some 200 million more permits will be auctioned in 2016 than in 2015 in the EU ETS as fewer permits are withheld under the backloading scheme.

This will mean higher traded volumes and an increase in the value of the European market this year which along with continued growth in North America, will help boost the overall value of global carbon markets in 2016 to 60 billion euros.

($1 = 0.9178 euros)

(Reporting By Susanna Twidale, editing by David Evans)

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