Environmental Leader has reported that the Hungarian government sold 2 million previously used CERs, the market became tepid. Then when prices fell from more than 12 euro per credit to less than one euro, trading was suspended on two exchanges, Bluenext and Nord Pool. The NYT provided more details of the transaction, stating The credits appear to be part of massive blocks of CERs awarded to Eastern European states and Russia after the collapse of Soviet-era industry. This created a loophole used by Hungary to reintroduce used CERs back into the market… Carbon traders said countries like Hungary were exploiting the loophole to earn more money from the carbon trading system than they could by selling the credits that they had previously earned under the Kyoto system… The traders said at least one other E.U. member state had acted similarly earlier this year. The EU said they were “surprised and concerned” about the situation. BusinessWeek quoted others who expressed more urgency about the matter: “The supply and demand dynamics have been changed,” said Paul Kelly, chief executive officer of JPMorgan’s EcoSecurities unit. While the scope of the problem has yet to be determined, buyers are “questioning the authenticity” of what
Read more →In 2009, there was a general sense in the US that some regulatory and economic certainty would finally be established relative to greenhouse gases, and CO2 in particular. The current administration made highly public moves and statements to that effect, which were mirrored by action in Congress and the Senate. EPA issued its finding of endangerment. And there was significant optimism that the COP15 Copenhagen meeting would bear fruit. Fast forward to February 2010. There has been quite a shift in direction and now there is arguably more business risk related to CO2/GHG than there was going into 2009. Among recent highlights: Nike formally announced that they are abandoning the use of carbon offsets and Renewable Energy Certificates (RECs), citing, among other concerns: there is substantial scrutiny of the use of RECs, in particular related to whether they in fact help create new renewable power, or whether they are simply payment to a project that would have existed anyway. … Moving forward, however, our preference is to achieve climate neutrality through a combination of energy efficiency and the purchase of more direct forms of renewable energy, through on-site applications and other means. The German Emissions Trading Authority (DEHSt) computer system
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