EU EMISSION ALLOWANCES AND EU CARBON FUTURES

EU Emissions Trading
In 2005, to help comply with their Kyoto protocol commitment to reduce greenhouse gas emissions, the EU member states sanctioned trading in EU emission allowances (EUAs). The market is open to everyone although traders must be able to verify their respective EUA emission levels.

EUAs are issued to carbon-producing companies according to a national allocation. Each EUA allows its owner to emit 1 tonne of CO₂ or its equivalent.

The EEX operates both spot and derivatives markets in EUAs. The spot market enables producers who emit less than their allocation to sell their unused EUAs, while allowing those who exceed their allocation to buy the certificates they need. Thus, emission obligations are fulfilled and production processes optimised.

The EEX derivatives market, where trading takes place in EUA futures for the second (2008−2012) compliance periods, enables traders to engage in price hedging, in order to improve their CO₂ risk management and planning.

EEX and Eurex Join Forces in CO₂ Trading [ more ]

Contract Specifications

 
Spot Market
Derivatives Market
Contract
EU emission allowances from the first EU compliance period (2005–2007)
EU emission allowances from the second compliance period (2008–2012)
Maturity
 -
First exchange day in December 2008, …,2012
Contract volume
1 t CO2
1,000 t CO2
Quotation
in €/t CO2 to two decimal places
in €/t CO2 to two decimal places
Fulfilment
Payment versus delivery
Payment versus delivery
Transaction fees
0.01 €/t CO2 exchange fee
0.01 €/t CO2 clearing fee

0.015 €/t CO2 OTC clearing
0.002 €/t CO2 exchange fee
0.001 €/t CO2 clearing fee

0.003 €/t CO2 OTC clearing