UN Emission Units Plunge in Biggest Weekly Drop Since January
United Nations Emission Reduction Units posted their biggest weekly decline since January after the European Commission said it would upgrade credits awaiting approval for use in its carbon market, boosting supply.
ERUs for December fell 31 percent to close at 22 euro cents ($0.30) a metric ton on the ICE Futures Europe exchange in London, the lowest since July 17. They earlier plunged as much as 56 percent and ended last week at 31 cents.
The commission announced today it would upgrade ERUs to eligible from pending/ineligible on Nov. 21. Next month’s futures expire on Dec. 16. The move probably prodded some traders to sell, Mark Owen-Lloyd, trading director at Clean Energy Group Ltd. in London, said today by e-mail.
The EU market allows factories, power stations and airlines to use UN offsets for a portion of compliance needs. The bloc is seeking to fix a glut in supply in its greenhouse gas program, the world’s largest by traded volume. The oversupply reached 18 percent of total emissions of 9.8 billion tons in the five years through 2012, according to Bloomberg New Energy Finance.
UN Certified Emission Reductions for December closed at 42 cents, 13 percent less than yesterday. European Union carbon permits for December dropped 2 percent to close at 4.50 euros a ton, paring the weekly gain to 1 cent.
To contact the reporter on this story: Mathew Carr in London at email@example.com
To contact the editor responsible for this story: Lars Paulsson at firstname.lastname@example.org