Issue LXXIV

Carbon Newsletter

DBLM Solutions
28 March 2013
Carbon Dec 13 is currently at 4.88 and looks to be consolidating under the 5 mark. The energy complex is gaining positive momentum with Brent just shy of 110 and German and French Baseload also up due to weather conditions and an easing back of wind and solar input into their respective grids. CERs have dropped to 9 cents amid speculation that the Clean Development Mechanism is to be restructured. This was always on the cards as the New Market mechanisms are set to be introduced to the EUETS. The project based CDM and ERU will lose the lions share of the offset market to sector wide GHG emission strategies. This process has already started through the submission of Nationally appropriate Mitigation Actions (Namas). The general consensus is that Namas will Morph with Program of Activities CDM projects to form offsets from a cross sectoral base tht can be used for compliance purposes.
Weekly Recap ICE EUA Spot 4.34 4.08 4.42 4.55 4.88 1,119 12.44% ICE CER Spot 0.16 0.15 0.16 0.14 0.09 872 -0.43% ICE EUA Dec13 4.42 4.15 4.49 4.62 4.95 114,389 11.99% ICE CER Dec13 0.32 0.31 0.33 0.33 0.33 5,352 3.12%

The European Union Climate Commissioner,Connie Hedegaard, yesterday said that she is confident that backloading will go through. Were getting there on the member states side; the challenge is the vote in the European Parliament, Hedegaard said. Im confident that we will get through with backloading and come to what really matters. And what really matters is the discussion on more structural options. Structural options refer to the 6 options that have been reported in this newsletter previosly and are now attached. The EUA/CER spread narrowed this week to 4.79 at close of business last night versus the 3.74 spread we witnessed the week before and 3.29 the previous week. Romania, Bulgaria and Portugal still havent adopted an official poition on backloading and the Czech Republic have had a change of heart on their prevvious position and seem to be more flexible. All will be relieved when the vote takes place on the 16 April. The UK published their GHG emissions this morning, results showed a rise of 3.5% year on year in 2012. The rise in emissions is attributed to an increase in output from coal fire power stations.

21/03/2013 22/03/2013 25/03/2013 26/03/2013 27/03/2013 Volumes lots Week %

Auctions
EEX held auctions last Thursday, Friday, Monday and Tuesday, auction prices were 4.06, 4.23, 4.10 & 4.54 respectively. An additional 16,648,500 Phase 3 EUAs were brought to market via EEX.. The cover ratios for the above auctions were 3.2, 1.20,1.79 & 2.83 respectively. This mornings auction cleared 3,587,500 million credits at 4.70 each. During the week, there was also a Flemish, Lithuanian and Czech Auction which released 6,335,500 Phase 2 EUAs to market at 3.32, 4.72 and 3.67 respectively.

The contents of the Newsletter is not a recommendation, either implicit or explicit, to buy or sell emission permits. Contact: David Boles, Compliance Markets -Direct: +3531 4433 584. DBLM Solutions is partly funded by the Wicklow Enterprise Board.