EU Allowances edged higher on Friday as firmer German dark spreads supported prices but still ended the week 4.3% lower on concerns over the fate of the bloc’s MSR.

The Dec-15 EUA futures closed up 4 cents on the previous close at €6.80 with more than 20 million units changing hands on ICE.

“We rose a bit today, with the darks recovering despite a weaker euro,” one trader said.

German baseload power for delivery next year eased slightly, but the dip was outdone by a more-than $1 fall in DES ARA coal to $59.85/tonne.

Front-year EUAs traded in a 24-cent range, the narrowest since late February, while Dec-15 CERs added 2 cents to 42 cents.

Some traders dumped EUAs late on Thursday after being spooked by leaked details of EU presidency holder Latvia’s MSR proposal.

Latvia distributed a document to member states ahead of a Mar. 10 working group meeting, in an attempt to bridge the gap between opposing factions among east and west European governments.

Latvia’s plan made no reference to an ENVI amendment to put unallocated EUAs directly into the MSR when it launches in early 2019. It instead said any large increase in supply due to come to market at the end of a trading period should be sold more gradually in the first two years of the next phase.

Poland and a group of seven countries believe that they have enough votes to block ENVI’s MSR proposal in its current form, while Germany and the west are pushing for a quick agreement on the matter.

By Mike Szabo – mike@carbon-pulse.com