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Policy & Regulation

Brexit fears jitter EU carbon market

Prices for EU carbon allowances have fallen in recent weeks over fears of a hard Brexit and a global recession, but further gains are possible even if the UK drops out of the ETS Prices for EU carbon allowances have fallen in recent weeks over fears of a hard Brexit and a global recession, but further gains are possible even if the UK drops out of the ETS.
By Andreas Walstad 23 August 2019 Europe & Russia / Policy & Regulation 0 34516
The Drax power station in the UK. (Drax)

An impressive bull run in prices for EU carbon allowances in recent months has boosted fuel-switching from coal to gas across Europe, but prices have cooled off recently partly over fears UK polluters will start selling allowances they no longer need in the event of a no-deal Brexit. The benchmark December 2019 contract was trading just above €25 per ton ($30.4/t) on the ICE Exchange on Friday morning after hitting €30/t in July. The bearish move has come despite...