Bogdan Tudorache

EU carbon certificates stormed to a new all-time high on Thursday, stretching Monday’s record and closing in on 35 euro as energy and equity markets also notched gains.

The price of carbon certificates has reached about 34.65 euro, and analysts expect an even higher price increase over the year, according to Carbonexpert.

The price of the certificates had reached on Monday, January 4, a record level of 34.25 euro/t, according to S&P Global, for the contracts with delivery in December 2021, as market continued to lack fresh supply from auctions until daily sales resume on January 29, driving additional interest in the secondary markets.

The EU Emissions Trading Scheme (EU ETS) is the EU’s main policy on combating climate change, and is also the world’s largest system for capping and trading greenhouse gas emissions. For total emissions from industrial sectors with a high level of emissions, a limit, or ceiling, has been introduced, which is reduced over time. The cap restricts the emissions of more than 11,000 energy-intensive installations across the EU, covering about half of the volume of greenhouse gas emissions. These installations receive emission certificates or buy them at auctions, but can also sell them, depending on their own needs. Each certificate represents the right to emit one tonne of carbon dioxide (CO2) equivalent. Each year, installations must return a number of certificates equal to the amount of carbon dioxide equivalent (CO2e) emitted.