ICE to temporarily suspend spot CER trade ahead of EU ETS ban

Published 15:53 on March 5, 2015  /  Last updated at 14:51 on May 11, 2016  /  EMEA, EU ETS  /  No Comments

The EU's largest emissions exchange ICE Futures Europe will suspend trade in its spot CER contracts, also known as daily futures, on Mar. 27, 30 and 31 to avoid problems relating to an imminent ban on the use of most types of Kyoto credits in the EU ETS.

The EU’s largest emissions exchange ICE Futures Europe will suspend trade in its spot CER contracts, also known as daily futures, from Mar. 27-31 to avoid problems relating to an imminent ban on the use of most types of Kyoto credits in the EU ETS.

Under EU rules, Kyoto credits issued against emissions reductions made before 2013 must be exchanged for EUAs through the EU Registry prior to a Mar. 31, 2015 deadline.

Any that are not exchanged will be transferred to a Kyoto Protocol account in the EU member state’s section of the Union Registry, and into a personal holding account if allowed by said member state.

Under ICE’s rules, any credits traded on its exchange must be eligible in the EU ETS upon delivery, meaning a buyer could purchase ETS-eligible CERs via ICE’s daily futures at the end of March, but find that they’re ineligible upon delivery in early April.

Spot CERs are currently near worthless due to a dearth of demand, with ICE’s daily CER futures bid/offered at €0.02/0.03 on Thursday afternoon.

Click here for more information on the imminent ban (Regulation No. 389/2013)

By Mike Szabo – mike@carbon-pulse.com

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