Carbon price continues to rise, Morgan Stanley sees price at 50 euro

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Bogdan Tudorache

The price of the CO2 certificate on the ICE ECX exchange in London opened the trading sessions on Wednesday morning at 42.05 euro/tCO2, according to Carbonexpert. According to the market data consulted by energynomics.ro, the price reached 43.7 euro on Wednesday, on the futures market, for medium-term contracts. However, the largest volumes of the day stood at a price of 42.37 euros.

The EUA certificate had risen slightly on Tuesday, by 0.74%, amid a sense of price advance that has dominated the market lately. Successfully completed auctions encouraged market participants to estimate that prices could retest record levels earlier this month of more than 43/tCO2, Carbonexpert analysts say.

The estimates take into account the forecasts given by Morgan Stanley, which raises the short-term outlook for the carbon price in the EU ETS to 50 euro/tCO2 based on “positive” policy signals and the continued entry of new investors into the market.

The European Commission launched a public consultation in March 2021 on cross-border CO2 transport networks, which could gain priority access to European funding. At the same time, the EU intends to launch the first large-scale Carbon Capture & Storage (CCS) projects by the end of the decade, while environmental NGOs aim to extend the scope of the EU ETS to transport.

In fact, the inclusion of transport and buildings in the EU scheme for capping and trading greenhouse gas emissions has already been proposed by the new Commission, as we reported here.

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