This newsletter was published 18.09.2024 at 17:39pm CEST

The current prices on the European carbon market are as follows:

Downward pressure on energy commodities continues, although the pace of falling prices has slightly slowed. Power prices have stabilized at around 85 EUR/MWh, while front-month gas TTF continues to trade around the 35 EUR level, which represents one of the largest open interests ahead of the October gas option expiry. Carbon has been in the meantime receiving considerable support, likely due to compliance buying in the weeks leading up to the deadline. Moreover, the third quarter of the year is coming to an end, and the September option expiry for EUAs is just a week away. Open interest remains high, particularly around current market price levels. The largest open interest is at 65 EUR strike, with over 17 million EUAs of open interest. Current price action suggests that 65 EUR could act as a magnet; however, 60 EUR also appears within reach. Over the past few weeks, the market has experienced no major surprises or shocks, which may explain the relatively low volatility. Fundamentals remain stable, with warm temperatures, while renewable power generation, particularly hydropower, remains strong. Auction results have been quite solid recently, with Monday’s EU auction clearing at a 1.70 EUR premium to the secondary market. Interestingly, despite this strong clearing result, it did not trigger enough buying activity to push the market above 65 EUR that day.

German power prices are down by 2.15 EUR since last week, with the front-year contract trading at 86.00 EUR/MWh. API2 coal prices are down by 1.25 USD since last week, with the Cal-25 contract trading at 115.00 USD/tonne. Front-year gas prices are down by 0.115 EUR since last week, with the TTF Cal-25 trading at 37.475 EUR/MWh. EUR/USD is down by 120 points since last week and is currently trading at 1.1120.

Price development of EUA Dec2024 futures contract