Hundreds of Italian installations were on Thursday told by the government they are at risk of not getting their 2015 EUA allocation before next week’s compliance deadline, news that caused some operators to “panic”.

In a document from Italy’s environment ministry and seen by Carbon Pulse, the government names more than 300 industrial installations that may not receive their share of the allowances that have yet to be handed this year.

The delay stems from a large number of individual allocations that are being checked by the European Commission because the installations, for example, have changed their activity levels.

“Some of our clients are panicking because they’re on ‘the list’. They are short (for 2014 compliance) and really need those allowances,” one broker said, adding that this has helped fuel the 3.5% rise in EUA prices over the past two days.

The broker estimated the unallocated allowances at around 38 million.

While most industrial installations are holding surplus allowances, some face shortfalls and have started borrowing from the current year’s allocation to cover their emissions from the previous year.

“This is creating some extreme pain for many companies in Italy. The smallest guys bear the biggest burden because they now have to part with cash to buy spot allowances before next week,” another broker said, referring to the Apr. 30 EU ETS compliance deadline for 2014 emissions.

A source at the environment ministry said the list of installations at risk of not getting their permits in time would be updated early next week.

The two brokers said Italy earlier this week started handing out 2015 allowances to industrial installations that were not having their allocations assessed.  According to the document, some 45 million units went to around 670 installations.

By Mike Szabo – mike@carbon-pulse.com