Issue CXXII

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.
Carbon Newsletter
DBLM Solutions
10 July 2014


The EUA Dec13 contract is currently at 5.80.
Analysts have forecast a bullish run on carbon
prices over the next three months, estimating a rise
of some 15%, stabilising around the 7 mark.
German baseload for delivery today was down 1.7
euros to 31.80/ MWhr due to a rise in solar output
whilst French day ahead power prices rebounded
slightly after a sharp fall the previous day due to
ample nuclear availability.
Weekly
Recap
ICE
EUA
Spot
ICE CER
Spot
ICE
EUA
Dec13
ICE CER
Dec13
03/07/2014 5.99 0.16 6.03 0.16
04/07/2014 5.64 0.17 5.81 0.17
07/07/2014 5.53 0.17 5.60 0.17
08/07/2014 5.69 0.16 5.76 0.16
09/07/2014 5.76 0.15 5.83 0.15
Volumes lots 725 0 72,548 129
Week %

-3.84% -6.25% -3.31% -6.25%
The EUA/CER spread narrowed this week to
5.61, at close of business last night versus the
5.87 spread we witnessed last week and 5.56 the
week before.
Auctions
EEX held auctions last Thursday, Friday, Monday
& Tuesday Auction prices were 5.97, 5.91,
5.50, & 5.60 respectively. The cover ratios for
the above auctions were 5.22, 4.78, 4.54 & 5.28
respectively.
New Entrants Reserve
EUETS participants that expand operations or
construct new installations are entitled to an
additional free allocation from the NER in Phase 3.
The NER initially held 480.2 million allowances.
To date, 55.9 million allowances are reserved for
186 installations during Phase 3. Data on cessation
of production or significant downsizing is also
published this week by the European Commission.
In 2013, allocation was reduced by around 35
million allowances for approximately 1000
installations that produced significantly less than
the production on which allocation was calculated,
or that reduced their production capacity.
China and US
On Tuesday, China and the US signed 8
partnership pacts to cut greenhouse gases. The
pacts are centred aroung technology sharing fom
educational institutions. Examples would be in the
clean coal power sector and recovering oil from
captured carbon. The move is expected to
accelerate the burgeoning carbon capture and
storage technology. In europe, Drax have just been
awarded a 300m + grant to facilitate their carbon
capture and storage efforts.
It emerged yesterday that the European Parliament
are already seeking a lead lawmaker(MEP) to
supervise a legislative proposal to reform the EU
emissions trading scheme (ETS) by as early as next
week. This is the start of the carbon reserve reform
which will controL EUA supply into the market.