Authors
Ashley Thomas
Since Daiwa's December 2008 Carbon Report, the EUA December 2009 forward price has fallen from €16/tonne to €10/tonne as weakening economic conditions have reduced European industrial output and EU ETS industrials have sold forward allowances to raise finance at relatively attractive rates. Carbon price movements have become detached from oil prices. Daiwa now forecasts a 6.7% contraction in 2009 EU industrial output compared to a 2.7% decline forecast in their December report. Their forecast short position for the cumulative 2008-2020 period means the 2020 EUA forecast is marginally reduced from €25 to €24/tonne, driven by estimated summer fuel switching costs.?