Discover and read the best of Twitter Threads about #euets

Most recents (24)

European Carbon price shows very strong correlation with Gas price lately

Today: 📈Front-month TTF +23% and EUA +5%

Last week when TTF fell 14%, it pulled down #EUETS price too 📉 #Fuelswitchingison Image
And TTF gas is down today, EUA is down too 🙃

📈📉📈📉 Image
Read 4 tweets
🚀This week European Carbon price approached €100

Main drivers:

Short-term: short-covering, options, catch-up hedging, colder weather

Underlying: Compliance demand, improving economic outlook and optimism following #EUETS reform deal

🧵A thread
The Dec23 EUA contract broke above several resistance levels in recent sessions, hitting €97.55/t on 1 February, the highest since August 2022.
The rally since mid-January has definitely caught some participants unprepared, triggering short-covering
Read 14 tweets
Looking for a short overview of what was agreed last night on #EUETS?

Here a little 🧵 with the main outcomes

You can find @CANEurope’s press release here:…
Remains off track with 1.5 target 🌍🔥
ETS 2030 target increased to 62% (from 61% EC), but mainly a trick with numbers since the cap trajectory is weakened due a split of rebasing (90m in 2024 + 27m in 2026)
LRF is 4.3% (2024-2027) and 4.4% (2028-2030)
Cumulative emissions over the whole period are only marginally better than the EC proposal: 12,295 Mt (EC: 12,309 Mt)

Still, compared to status quo the revised ETS will roughly save 1,486 Mt cumulative emissions compared to the baseline (2x 🇩🇪 annual emissions)
Read 20 tweets
Earlier today, #EU agreed on a badly needed reform of the EU Emissions Trading System (#EUETS) which is the system of cap-and-trade of #carbonemissions allowances for #energyintensive industries and the #powergeneration sector. The most critical points are:
1. Agreement to make it compulsory for #EU members to dedicate all their auctioning revenues to #climateaction #investments
2. Sectors covered by the Carbon Border Adjustment Mechanism (recently agreed #EU #carbon import tax) such as #cement, #aluminium, #fertilisers, #electricty production, #hydrogen, #iron and #steel, will see an end to free #allowances for these sectors between 2026 and 2034
Read 8 tweets
@abclimate @citizensane1 @janrosenow @foresightdk @annagumbau @whatmatterspod
Just listened to a discussion on district heatin networks DHNs on…
Some takeaways from me:
* the #EU is woefully anware of the importance of the heating question in general and->
-> the importance of district heating networks in particular
* this is mirrored by the fact, that in the #repowereu scheme, 8.5 bio € are earmared for it while 210 bio € would be appropriate
* DHNs are much more efficient in primary energy use than every building burning ->
-> the gas in its own heating: -30% gas use
* DHN is large projects which mean a framework is needed for organization, coordination, de-risking, business model
* this framework is lacking sorely.
* future heat source mix (very coarse): geothermal 10%, waste heat 20%, heat pumps->
Read 10 tweets
Just a few charts to recap #EUETS price activity in the last couple of months. EUAs have traded between €75-€92 for the last five months. The price floor has been pretty solid at €75-79, while the ceiling has mostly been around €90. #OCTT 1/10
To be clear though, EUA prices are nowhere where they need to be (under normal conditions). Chart shows price of EUAs needed to force switching coal -> gas for yr-ahead power generation in Germany. #EUETS price is €88 today, needs to be minimum €405 for switching. #OCTT 2/10
Why? Well, looky here: German cal-23 power is on its way to quadrupling in price this year. TTF cal-23 gas is already 4x where it started 2022. And cal-23 API2 coal is around 3x. Meanwhile, #EUETS price is up 4.6% YTD. #OCTT 3/10
Read 10 tweets
1/ If we really want to fight the climate change and decarbonise the world, we need globally unified carbon price.

#CBAM is a good start but it won't be enough. Namely, when it comes to GHG emissions, there are no country borders. GHG emissions are global. #EUETS #OCTT
2/ Very strict environmental rules in one country can lead to carbon leakage (especially in heavy industry) and reduction in own production. This is often compensated by increased production and imports from countries that don't take environmental objectives so seriously.
3/ Good example is aluminum. CO2 intensity per tonne of aluminum produced in China is twice as much as in EU.

Lowering EU aluminum production and consequently importing more of it from China will indeed lower EU emissions. But sadly, as a result, global emissions will rise.
Read 4 tweets
Not enough!

The EU has taken several decisions on air transport this week - and failed to bring it on track for 1.5 degrees.

We need pressure to get the EU to do more!
#Thread 🧵
1/ Reality check: EU is failing to keep us on track for 1.5 deg
June 24
🇪🇺 reveals new Alliance for Zero Emission Aviation to “make hydrogen-powered & electric aircraft a reality” – even the industry itself acknowledges: options won’t be viable until it's too late - 2035-40 at best - & will only fly a few hundred km… 2/
June 27- #Fitfor55 aviation package: Transport MEPs set impossible targets for using 85% fossil fuel substitutes #SAFs for ✈️ by 2050.
IATA targets for substituting even 5-10% fossil kerosene have NEVER been met since they started to set targets in 2008!…
Read 9 tweets
1/ #EUETS #carbon reform gets through Parliament. Now Council‘s 27 members have to reach their views. They tend to sail much closer to the law. And then it goes to Trilogue discussions. So whilst Parliament’s view is important, it is not final. Summary of Parliament view
- 2030 target slightly tighter: c64% instead of EU’s original 61% proposal
- One-off reductions of 70mt in 2024 and 50mt in 2026
- CBAM kicks in 2027 ramping up fully 2032 (prior 2034) with corresponding reduction in free allowances
- Market access getting Commission to -> 3/
produce a report in July 2023 assessing impact of restricting access to physical allowances. Frankly, this just shows a massive naivety: the vast majority of speculative elements happens in the options/derivatives market
Read 4 tweets
A few thoughts on Commission proposal to auction MSR volumes:
1/ it’s approx. revenue neutral, or even negative
2/ it could therefore be a measure to control prices
2/ however, it’s not a done deal
3/ and, if approved, future discretionary uses should be limited
1/ Would reduce revenues for existing auctions sufficiently to make it revenue neutral. If the true price impact is ~14/t (2x Wednesday’s price move, assuming 50% probability priced in), then at an estimated 1800-2000Mt of auctions over 2023-26 this is worth 25-28 bn EUR. #OCTT
2/ If revenue neutral, that means it primarily reduces the price. This would be scary if the true objective, and would undermine faith in the market. This theory could be confirmed if the EIB, in charge of auctioning, has any ad hoc discretion on the timing of sales. #OCTT #EUETS
Read 8 tweets
Despite its YTD rally coal is still more profitable than gas in power generation for a lot of the curve. Carbon has dragged itself into positive territory for the year, but could break out later today when ENVI votes on #EUETS reforms. #OCTT
ICE trading volume in the Dec-22 contract is setting new YTD records, and even though traders complain about a lack of liquidity, we're averaging a record 25 million EUAs a day in the benchmark. Go figure..... #EUETS #OCTT
The negative TTF gas-EUA correlation that we saw for a while seems to be fading #EUETS #OCTT
Read 4 tweets
Der Bericht vom #Expertenrat für #Klimafragen @ERK_Klima ist veröffentlicht. Dabei haben wir uns intensiv mit dem Mechanismus des #Klimaschutzgesetzes beschäftigt. Wir identifizieren eine Reihe von Handlungsfeldern & zeigen konkrete Optionen für eine Weiterentwicklung auf.
Ein🧵 Image
2/ Grundsätzliche Handlungsfelder sind:
- Auslösemechanismus für Sofortprogramme ist zu mechanistisch
- fehlende vorausschauende Perspektive
- erweitertes Monitoring notwendig
- mangelnde Kongruenz des KSG mit den übergeordneten Instrumenten #EUETS und #BEHG
3/ Die Auslösung eines Sofortprogrammes hat beim Steuerungssignal Mängel und ist zu mechanistisch in der Anwendung. Dafür machen wir Vorschläge:
- Umstellung auf Normjahre/bereinigte Daten
- bessere Datenverfügbarkeit
- Definition eines Korridors
- automatisch BEHG Preis anheben
Read 15 tweets
Der Bericht des Expertenrats für #Klimafragen @ERK_Klima zu den Emissionsdaten 2021 ist da:
➡️#Gebäude & #Verkehr haben das Sektorziel verfehlt
➡️Die Emissionsintensität ist gestiegen
➡️Es werden Vorschläge zur Weiterentwicklung des KSG gemacht
1/n🧵 Image
2/ Die Emissionen wären im #Verkehrssektor ohne #Corona noch höher ausgefallen. Der #Gebäudesektor hat zum zweiten Mal in Folge das Sektorziel überschritten. Allerdings ist der Überschreitungswert kleiner als die durch Lagerhaltung und Witterung bedingten Einflüsse
3/ Für beide Sektoren wird jetzt nach § 8 #Klimaschutzgesetz jeweils ein Sofortprogramm notwendig, das die Einhaltung des Sektorziels für die folgenden Jahre sicherstellt.
Der #Industriesektor hat sein Ziel knapp erreicht, der Einfluss der Sondereffekte ist hier nicht eindeutig
Read 10 tweets
2/ 11 EU nations say “Now is the time to be bold and to move ahead with determination with the green transition. Any delay ... will only prolong our energy dependence … negotiations on the package should therefore be accelerated and ambitions ramped up”
3/ “A strong ETS is the cornerstone of the FF55 package, providing us with an effective tool to ensure a cost-effective transition combined with ambitious sectoral measures and standards”
Read 3 tweets
@EU_Commission presented its #ownresources proposal today. It lays out 3 new revenue streams to:
- repay EU debt #NextGenerationEU
- finance the #SocialClimateFund

A short thread on what it means for #EUETS contributions based on some initial rough calculations 🧵1/13
First things first. 3 proposed new revenue streams are:
- 25% ETS (1+2) revenues: ~12.5b/y
- 75% CBAM revenues: ~0.8b/y
- 15% residual profits from large, profitable multinational enterprises: ~2.5-4b/y

On #CBAM, this was obviously expected; still disappointing. Many (including @e3g) argue that revenues should flow back to vulnerable #LDCs through adaptation and mitigation finance.
@Europarl_EN also seems keen on this @MChahim @kvanbrempt @MalinBjork_EU @KarinKarlsbro 3/13
Read 14 tweets
Szanowny Panie Ministrze @JKowalski_posel . W ciągu ostatnich kilkudziesięciu godzin wygłosił Pan szereg oświadczeń o systemie #EUETS nie do końca zgodnych z faktami. Zdając sobie sprawę ze skomplikowania tematu, chcę jednak sprostować kilka informacji.
Polska nie otrzymała w tym roku 105 mln. darmowych uprawnień do emisji. Uprawnienia do emisji co do zasady są sprzedawane na aukcjach i Polska otrzymała środki ze sprzedaży ok. 105 mln z nich. Dokładniej ok. 25,2 mld zł. 2/11
Dodatkowo, Polska otrzymała prawo do przyznania - zgodnie z art.10a Dyrektywy ETS darmowych uprawnień dla polskiego przemysłu narażonego na ucieczkę emisji. Łącznie ok. 60 mln uprawnień (jeśli posiada Pan dokładniejsze dane - proszę o informacje - chętnie skoryguję błąd). 3/11
Read 11 tweets
🏭Coal-fired power plants are still being favored in German power merit order...despite €70/t #EUETS price

European Gas price is just too HIGH

This does exhibit some fundamental support for current carbon rally: high coal burn leads to high EUA demand Image
Coal-fired plants' advantage is clearly shown in its Short run marginal cost vs Gas.

even the 36% efficient coal plants are in the money, as surging gas prices driving up Gas SRMC Image
Thus, it is not surprising to see German coal plants' load hours have picked up notably this autumn.

The chart shows monthly average load of 'hard coal' (not brown coal/lignite). Image
Read 4 tweets
EU Commission now unveiling a toolbox of measures to to respond to rapidly rising energy prices as demand upticks post-pandemic.

They’re under intense pressure from national governments to do something. But most of this toolbox is just reminding countries what *they* can do.
EU Energy Commissioner @KadriSimson reminds governments that #EUETS revenues are way up.

“We call on member states to use that additional income to address the social impact of the energy price surge where needed.”
Immediate measures include:

👩‍👧‍👧Emergency income support for the energy-poor through vouchers

💶Deferred bill payments;

🏦Temporary, targeted reductions in taxation rates

🏬Aid to companies ion line with EU state aid rules
Read 7 tweets
What’s driving the gas price surge? 1/

@PatAlvarezB chalks it up to these factors: Natural gas prices in Europe may remain elevated heading into the winter amid a tightening supply scenario and below-average storage levels, subdued LNG and pipeline imports.

2/ The run-up in CO2 prices are also a factor: As CO2 prices increase, electric generators are incentivized to operate cleaner burning #gas plants at the expense of coal, which helps to drive gas demand higher and consequently may provide structural support for higher gas prices.
3/ Will the run-up in #gas prices be transitory or enduring? What about #oil? Is the rise in #carbon prices structural?

Read our analysis on @TheTerminal by visiting BI<GO> #OOTT #ONGT #EUETS #carbon #energytransition #wind #solar #renewables

Read 3 tweets
1/11 Yesterday’s #Fitfor55 launch press conference was dominated by questions about the social impact. So, I took a bit of time to look at the new measures in the package to support low-income households to decarbonise. @RegAssistProj @RightToEnergy Image
2/11 First, raised ambition across the package is good for all. Effects of #ClimateChange will be felt by poorest most. Climate ambition is essential but not enough. Climate ambition must come hand in hand with commitment to address structural inequities.
3/11 The Energy Efficiency Directive is the clear winner of prize for social conscience. New provisions include first EU definition of #energypoverty. Oddly it refers to lack of access to essential services but not affordability of those services and excludes cooking needs. #EED Image
Read 11 tweets
Thread: Following today's #FitFor55 package, here's my initial analysis of the #EUETS revision proposal. Long story short: It becomes more difficult to pollute, but sustainable frontrunners are still disadvantaged compared to laggards.
#EUETS target: Increased to -61% by 2030 compared to 2005, which covers industry + power + intra EU aviation and maritime. This is taken from last year's 2030 #ClimateTargetPlan (see pic), which implies that the target for stationary installations (industry/power) is only -64%
Big plus: #EUETS Linear Reduction Factor almost doubled to 4.2% as of 2024 + one-off reduction ("rebasing") of 119 mln allowances. Leads to a big 15%-POINT cut in free allowances (FA). This LRF was a huge battle in the previous reform, so hope it stays.
Read 14 tweets
Ahead of crucial #COP26 & amid intensifying climate crisis, the @EU_ Commission today presents the #FitFor55 package aiming at cutting EU emissions by 55% by 2030. Implementation will require far-reaching changes in mobility, housing, land use, industrial production. 1/11
The @EU_Commission sends the following signal to the international community: EU ups the ante to align the block on the 1.5° pathway, as pledged in the #ParisAgreement. #Fitfor55 will show whether the EU is ready to walk the climate talk while ensuring a just transition. 2/11
The walk will only be fully successful if environmental integrity and social and distributional justice go hand in hand. Agora welcomes the setting up of a social fund to ensure that its #Fitfor55 proposals lead to greater social solidarity. 3/11
Read 11 tweets
President @VonDerLeyen unveiling #FitFor55 climate package now.

It is the largest single batch of legislation to stop climate change proposed by any government anywhere, designed to update EU laws to meet the new 2030 emissions reduction target of 55% (raised from 40%).
That EU 2030 target was raised in December, motivated partly by the #FridaysForFuture climate protests.

But for the past 6 months there have been many questions about how the new target will be met.

Today we're getting answers.…
Other major economies are also setting more ambitious 2030 emissions reduction targets.

But today the EU becomes the first to spell out how to reach the goal with detailed policy proposals.…
Read 14 tweets
Am Mittwoch, 14.7. wird die #EUKommission das #Fitfor55 Paket vorstellen, ein riesiges Paket mit 12 Initiativen & Gesetzesvorschlägen zur Erreichung der #Klimaziele und zur Umsetzung des #EUGreenDeal.
Hier eine erste Einordnung auf Basis der bisherigen Leaks (1/n)
2/ Um was geht es:
Bei den #Klimazielen geht es um 55% Emissionsreduktion bis 2030, THG-Neutralität bis 2050 und netto-negativ danach. Den Ramen bildet der #EUGreenDeal, der eine umfassende Transformation inklusive einer #JustTransition beschreibt
3/ Das größte Paket ist sicherlich das rund um die Revision des #EUETS. Im #EUETS soll der Schiffsverkehr einbezogen werden und die #MSR angepasst werden. Weiterhin soll es einen neuen separaten "adjacent ETS" #ETS2 für Gebäude und Straßenverkehr geben, der 2025 starten soll.
Read 17 tweets

Related hashtags

Did Thread Reader help you today?

Support us! We are indie developers!

This site is made by just two indie developers on a laptop doing marketing, support and development! Read more about the story.

Become a Premium Member ($3.00/month or $30.00/year) and get exclusive features!

Become Premium

Too expensive? Make a small donation by buying us coffee ($5) or help with server cost ($10)

Donate via Paypal Become our Patreon

Thank you for your support!