27 Nov Regulatory
The EU has agreed on the ETS carbon trading rules for the period 2021-2030, subject to the European Chamber (Parliament) approval. The rules aim to reduce surplus EUAs in the market. Carbon prices could be as high as €35/t by 2023. Central and eastern European countries can increase their share of free allocations to coal power plants. But generally the Modernisation Fund excludes coal-fired plants. The Spanish government has already indicated that EU prices should rise to €15/t by 2020.
This month, the UK Department for Business, Energy and Industrial Strategy, published a consultation to bring forward the EU ETS 2018 compliance year deadline for UK installations. The aim is for UK operators in the EU ETS to surrender allowances early before the date of EU Exit on 29 March 2019. The consultation ends on 24 November. The government will then put forward legislation to the UK Parliament in December 2017 for changes to commence in January 2018. UK obligations would not lapse. For 2019, the UK is proposing to accept suspending issuing UK allowances between January and March 2019 if a UK/EU deal is not reached for this sector.