Weekly Posts

EU Record Annual Emissions, CCA Eyeing Tighter Supply

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Europe & UK

Uncertainty over energy supply amid Russia’s invasion of Ukraine continues to dominate the energy complex, and EUA prices are at the mercy of fluctuations in the natural gas market.

Last Friday saw the publication of preliminary verified emissions data for the EU ETS in 2021. Analysts calculated that emissions rose by 9.1% last year, the largest-ever annual increase, as EU economies emerged from the shadow of the Covid-19 pandemic, and coal consumption by power generation increased.

Prices did not react to the data, since it had been well-trailed, and the market is now looking ahead to the Commission’s calculation of the Total Number of Allowances in Circulation (TNAC), which will determine how many EUAs are withheld from the market between September 2022 and August 2023.

UK Allowance prices are maintaining a premium of around €10 to EUA levels as the British market awaits the publication of its own 2021 verified emissions data. Government officials have not set a date for this information.


California Allowance prices have stabilized above $30/tonne in the last week, as traders reacted to statements from state regulators pointing towards tighter allowance supply.

The state Air Resources Board is currently setting out proposals for the reform of the market in its next phase, with the goal of reaching a 40% reduction by 2030.

Pennsylvania lawmakers failed this week in an attempt to block regulations that would officially bring the state into the RGGI market, meaning the state is looking more likely to join the market in the third quarter.

Legislators in both houses fell short of the votes required to overturn Governor Tom Wolf’s veto against resolutions disapproving an executive order directing the state to join the multi-state market.