Issue XCI

Carbon Newsletter

DBLM Solutions
08 August 2013 The EUA Dec13 contract is currently at 4.46. The supply cut in Auctions for the month of August sees carbon hold around the 4.50 mark despite weak European power and Brent shedding all the gains seen at the end of last week. Brent is still dropping at 106.90. German utilities are lobbying the government due to inrodes greening policies are having on their bottom line. This comes before the general elections in September when political survival will be the priority over environmental issues.Some utilities have suggested that they could move gas and coal plants to countries with less rigourous greening measures.
Weekly Recap ICE EUA Spot 4.32 4.37 4.40 4.49 4.43 1,850 2.54% ICE CER Spot 0.58 0.60 0.65 0.66 0.65 55 12.06% ICE EUA Dec13 4.35 4.40 4.43 4.52 4.46 40,962 2.52% ICE CER Dec13 0.57 0.59 0.64 0.65 0.63 3,408 10.52%

Auctions
EEX held auctions last Thursday, Friday, Monday and Tuesday,auction prices were 4.36, 4.30, 4.40 and 4.39 respectively.This mornings Auction cleared at 4.43 each. The cover ratios for the above auctions were 6.14, 5.67, 6.11 & 6.13 & 3.91 respectively (Cover ratio Amount of bids/actual auction volume In total an extra 9,084,000 EUAs were brought to the market place.

EUETS NON Compliance

The UK government is seeking consultation on proposed changes to regulations in order to simplify the EUETS penalties for businesses. The UK have stated that they want to improve clarity and reduce the burden for businesses whilst reporting their GHGs into the ETS. It proposes to clarify the level of civil penalties to be imposed on operators carrying out unauthorised EU ETS activities and the discretion available to regulators to waive or reduce such penalties. It also seeks to enable regulators to impose a lower level of civil penalty for under-reporting EU ETS emissions prior to 2013 or even waive a penalty entirely, where operators self-report and surrender the necessary number of allowances. One of the proposals is to remove the strict liability for a 100tCO2 penalty and replace it with a discretionary 20tCO2 penalty in cases where operators voluntarily identify the under-reporting of emissions and surrender the required quantity of allowances. The consultation is open to any individual or organisation until 19 September 2013. It is not limited to stakeholders.

01/08/2013 02/08/2013 05/08/2013 06/08/2013 07/08/2013 Volumes lots Week %

The EUA/CER spread widened this week to 3.78 at close of business last night versus the 3.75 spread we witnessed the week before and 3.74 the previous week.

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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:00353 831744707 DBLM Solutions is partly funded by the Wicklow Enterprise Board.