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5 Pages

Agreement reached on EU emissions market reform

Agreement reached on EU emissions market reform

Report summary

On 5 May 2015, the European Council and Parliament reached agreement on the introduction of a Market Stability Reserve (MSR) measure to the EU Emissions Trading Scheme (ETS) from 2019. The introduction of the MSR represents a substantial reinforcement of the ETS and will drive a rebalancing of the carbon market's supply-demand balance. The cost of European emissions is likely to increase gradually in response to the MSR and high cost carbon will be a feature of the market in the long-term.

What's included?

This report includes 2 file(s)

  • Agreement reached on EU emissions market reform PDF - 336.83 KB 5 Pages, 0 Tables, 3 Figures
  • Agreement reached on EU emissions market reform.xls XLS - 2.88 MB


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  • Progress on EU emissions market reform
    • Rebalancing the EU emissions market
    • Europe finds common ground on reserve arrangements
    • The MSR will support higher emissions prices
      • ETS allowance (EUA) balance – with and without the market stability reverse
    • Higher emissions costs change the economics of power generation
      • Coal-gas parity costs in power – coal price cases (US$/t)
    • A long-term outlook of higher carbon costs makes investment in existing coal more difficult
    • Conclusions

In this report there are 3 tables or charts, including:

  • Progress on EU emissions market reform
    • Agreement reached on EU emissions market reform: Image 1
    • ETS (EUA) price forecast – comparing the H2 2014 outlook and MSR 2019 case
    • Agreement reached on EU emissions market reform: Image 3
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