Latest carbon market news: Traders crash

Carbon Has Third Weekly Drop as Poland Blocks Climate Ambition
2012-03-16 17:26:34.694 GMT

By Catherine Airlie and Mathew Carr
March 16 (Bloomberg) — European carbon-dioxide permits
fell for a third week after the bloc’s third-biggest polluter
blocked efforts to set reduction targets for 2030 and 2040.
European Union allowances for December lost 3.2 percent
this week after Poland on March 9 blocked a political statement
on the pathway for cutting greenhouse gases by at least 80
percent in 2050. It’s the second time in nine months that the
nation has raised concerns over EU-wide climate policy. Only
Germany and the U.K. emit more than Poland in Europe.
“The cause of the price slide is Poland’s blockade of
Roadmap 2050,” Heiko Siemann, an analyst in Munich for
UniCredit SpA, said in an e-mailed note today. It’s “cast gloom
over the market.”
Allowances dropped 18 cents today to 7.83 euros ($10.32) a
metric ton as of 5:09 p.m. on London’s ICE Futures Europe
exchange. Earlier in the week they traded as high as 8.24 euros,
after the European Parliament approved wording of a non-binding
resolution calling on the European Commission to temporarily
remove some permits from the market to bolster prices.
International disputes over the inclusion of airlines in
the carbon-trading system heightened this week, stoking concern
over reduced demand for allowances. The EU has said it would
exempt airlines from any country that adopts a comparable system
that prices the CO2 output of airlines.
Airbus SAS had 10 aircraft orders from China suspended
because of the nation’s opposition to carbon trading, according
to three people with knowledge of the matter. That takes the
number of orders China has suspended to 55, according to the

‘Romantic Stance’

“This showdown may be the final nail in the coffin of the
romantic stance of the EU,” Jan Pravda, director of Pravda
Capital Trading in Prague, said by e-mail. The bloc may now
become more “pragmatic” and refocus on improving energy
efficiency, which would cut carbon as a byproduct, he said.
Electricity for delivery in Germany next year, Europe’s
biggest power market, lost 0.4 percent this week to 52.50 euros
a megawatt-hour. It’s heading for its third weekly decline.
United Nations credits for December dropped 8 cents today
to 3.83 euros, taking their weekly decline to 4.5 percent.

For Related News and Information:
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–Editors: Alessandro Vitelli, Rob Verdonck.

To contact the reporters on this story:
Catherine Airlie in London at +44-20-7073-3308 or
Mathew Carr in London at +44-20-7073-3531 or