| ©ICIS HEREN - Romania eyes NER sales |
| 2010-04-06 |
| Romania’s massive surplus of EU allowances (EUAs) from its new entrant reserve (NER) will ultimately be auctioned to the market, the country’s environment ministry has confirmed to ICIS Heren. In Romania’s national allocation plan (NAP) for Phase II of the emissions trading scheme (ETS), the NER is pegged at 21.73m EUAs for the full five years. The ministry currently predicts, however, that in 2008–2012 only 6.73m will be allocated to new installations. This leaves a surplus of some 15m EUAs. There is a possibility that other new installations will request access to the NER in the next couple of years, although this is not expected to account for many EUAs. Should the volume of NER EUAs remain unchanged, Romania will have used just 31% of its reserve. Despite confirming that the NER surplus would be auctioned off, the Romanian environment ministry gave no indication whether all EUAs would be sold in one batch or when a sale might take place. “The mechanisms of the auction haven’t been set yet,” a source at the ministry told ICIS Heren. It appears many central and eastern European governments overestimated the required size of NERs. Like Romania, the Czech Republic is likely to only use around 30% of EUAs allocated to new entrants (see EDCM 23 October 2009), and also plans to auction its NER surplus. Member states that expect to have an NER surplus have a number of options available to them, besides selling them to the wider market. Some countries, such as Ireland and France, have stated they will simply cancel any surplus EUAs in their NERs at the end of 2012. A third option available to countries that have an NER surplus at the end of Phase II is to bank them into Phase III. However, the EU Commission, as the body responsible for EUA allocations, has yet to explain how this will be possible. Analysts suggest that a surplus might be reflected in the revenues channelled to specific countries after the Phase III auctions. (THE ICIS HEREN REPORTS - EDCM 4 223 / 17 November 2009) |
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