ANALYSIS: EU carbon price rally needs to extend, accelerate significantly for ’emergency handbrake’ intervention to even be considered

Published 12:42 on May 17, 2021  /  Last updated at 16:24 on May 18, 2021  /  EMEA, EU ETS, UK ETS  /  No Comments

(Subscribers only) - Germany last week took the side of non-interventionists in response to the sharp rise in EU carbon allowances, putting its faith in an existing protection against market spikes written into the emissions trading system’s rules. But a Carbon Pulse analysis shows that for this ‘emergency handbrake’ clause to be triggered, the rally in EUAs would need to both accelerate and extend significantly - by greater degrees than is being mooted by experts - before prompting lawmakers to even consider stepping in.

Germany last week took the side of non-interventionists in response to the sharp rise in EU carbon allowances, putting its faith in an existing protection against market spikes written into the emissions trading system’s rules. But a Carbon Pulse analysis shows that for this ‘emergency handbrake’ clause to be triggered, the rally in EUAs would need to both accelerate and extend significantly – by greater degrees than is being mooted by experts – before prompting lawmakers to even consider stepping in.

A Carbon Pulse subscription is required to read this content. Subscribe today to access our unrivalled news and intelligence, as well as our premium content including all job listings. Click here for details.

We offer a FREE TRIAL of our subscription service and it only takes a minute to register. If you already have a Carbon Pulse account, login here.

Comment