TH`ESE Docteur de l'Université Paris-Dauphine Morgan HERVÉ ...

We observe that the carbon allowance price responded to the typical market
fundamentals that were valid during phase I. In addition to this, the
price of EUAs was evidently influenced by any major announcement related
to phase II emissions cap (NAP submissions, reviews, validations and legal
challenges notably) and intertemporal flexibility with phase III of the
scheme. Secondary CER traded at a discount to EUAs. The price differential
between the two compliance assets reflects the limitations imposed
on the use of this flexibility mechanism for EU ETS compliance buyers and
some opportunistic trades on the part of the largest players on the market
(Mansanet-Bataller et al., 2011 [12]).
350
300
250
200
150
100
50
0
352.8
18%
200
9%
85
8%
Total Germany United
Kingdom
31.5
Total expected
17 13.5
2.6
0.19%
Auctioned until may 11, 2009 (%)
2 0.5 0.5
France Netherlands Hungary Ireland Austria Belgium Denmark
Figure 1.3: Volume of allowance auctioning during Phase II in Mt - from
Caisse des Dépôts Tendances Carbone 36
Phase II was also marked by a larger proportion of auctioning of allowances
than in phase I. Figure 1.3, reproduced from Tendances Carbone no. 36 and
based on EC data, illustrates this tendency. This increased the overall constraint
as a larger proportion of allowances was to be acquired rather than
allocated for free. This generated extra revenues for members states organising
auctions. In addition to this, the level of the new entrants reserves is
varying between member states depending on member states and ultimately
on additional installations that would be included in the scope of the EU
ETS during the course of phase II. Finally, in phase II, new parameters
in draft and revised NAP were introduced: benchmarking system for the
energy sector in the revised German NAP for phase II, etc. Table 1.4 summarises
the key data on phase II NAPs as of early 2010 (based on CDC
Climat Research, EC and NAP) 10 .
10 *ThereisnonewentrantsreserveintheNorwegianNAP.**The12Icelandicinstallations
falling within the scope of the Directive have been excluded as they are already
subject to more constraining emissions reduction measures.
16