Dóra Fazekas Carbon Market Implications for new EU - UniCredit ...

Based on these numbers, it may be concluded that – although in lieu of other relevant market data,
researchers could only rely on the data of the central registry (Kerr, 2007; Trotignon and Ellerman,
2008) – this is not a reliable method for determining the true number of transactions and allowance
flows.
Figure 46. Emissions allowance flows
Source: author’s calculation based on Hungarian Registry and CITL data
According to the Registry, Hungary saw the inflow of the most foreign emissions allowances
(41.37%) during the first year of the pilot phase; CITL did not record the surrendering of any
foreign allowances in Hungary during the first year. According to the Registry, approximately one-
third of foreign allowances (36%) entered Hungary during 2006; about one-fourth entered the
country during the last year (22.6%). Based on CITL figures, the second year was essentially
negligible (4.11%), while the third year saw the influx of the majority of foreign allowances
(95.89%).
In the author’s opinion, the differences in the transactions and uses of allowances may be explained
by the tendency for operators to use their grandfathered allowances first, before going on to
surrender foreign allowances. Trotignon and Ellerman (2008) also point out that installations tend
to use their own allowances first, before utilizing other allowances (p. 5). The two authors cite the
borrowing practices of individual installations as proof. They identified 69 installations (p. 21),
which only surrendered their own allowances during the first two years, but surrendered only
foreign allowances during the final year. The author has examined, for this dissertation, Hungarian
companies, which had surrendered foreign allowances, and found that the conclusions drawn by
Trotignon and Ellerman are in fact correct. Three-fourths of Hungarian companies used Hungarian-
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