Recession will cut EU carbon costs: Deutsche
Industrial carbon emissions will fall faster in Europe as result of a coming recession, cutting the demand for and price of emissions permits under the European Union's emissions trading scheme, said Deutsche Bank analysts
Industrial carbon emissions will fall faster in Europe as result of a coming recession, cutting the demand for and price of emissions permits under the European Union's emissions trading scheme, said Deutsche Bank analysts.
Lower carbon prices may hand an unexpected boost for politicians and green groups urging industry and bankers not to back down in the fight against climate change.Recession will cut industrial carbon dioxide emissions by about 100 million tonnes in 2009 compared to 2007, from current installations, the research note said on Wednesday.
"You've got a very serious contraction in the economy," said Deutsche analyst Mark Lewis.
Europe's biggest business lobby, BusinessEurope, said on Tuesday it wanted the European Union to cut costs under its climate program, given an expected sharp economic slowdown.
Deutsche Bank cut its 2008 EU allowance (EUA) price forecast to 30 euros ($40.98) per tonne of avoided carbon dioxide emissions from 40 euros, compared to an actual price on Wednesday of 23 euros.
EUAs have for a long time traded well below Deutsche and other analyst forecasts, partly as a result of a lack of liquidity whereby many affected companies do not actively trade.
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Source: Reuters