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Environmental Newsletter | March 2024 |  |
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| | | Dear customers, partners and friends of EEX,
This year promises to be again an exciting one. EEX Group has kicked off 2024 with a rapid growth in its EU and North American markets in Q1. Thanks to the successful market maker initiative we launched in Q4 2023 for the EUA market, we saw a significant increase of active participants in our order book. EEX´s EU ETS spot and futures markets have continued to grow by over 65% and 150% as compared to the previous year to date, following strong growth in orderbook trading because of competitive bid offer spreads. We would like to thank you for your continued support that have made this possible.
Over the last years, EEX Group actively contributed to the implementation of the EU ETS and support local emissions trading all over the globe. Having this in mind, the Turkish energy exchange EPİAŞ and EEX have signed a Memorandum of Understanding to underline the joint commitment in developing the Emissions Trading System (ETS) in Türkiye. We will keep you posted on the next steps.
In our North American markets, environmental products on Nodal Exchange posted new records in Q1 with more than 120,000 contracts traded, up 75% from the first three-month period a year earlier and open interest at the end of Q1 is up more than 40% from the previous year. In addition, open interest for voluntary REC products surpassed 70,000 lots during Q1, up 48% from a year earlier, representing more than 70 million MWh of renewable energy. These records as well as several others are detailed in our North American Update section.
At EEX, we believe in the power of in-person discussions. We have met many of you already at E-World in Essen in February and are looking forward meeting you again at the RECS Markets Meeting in April and at the Argus Carbon Markets Conference & EEX Group Geneva Workshop & Reception in May. There, you can hear the latest updates on our plans across all asset classes and discuss how we can continue to build markets together. Don’t hesitate to reach out to our experts in the meantime to let us know how we can support your daily business. Please also join our coming webinars or watch the videocasts of those you have missed to learn more about the markets we are active in. Read on to learn more.
In addition, changes to the EU ETS at the European level are top-of-mind for many of you. To that end, we are preparing a number of informational materials in the next quarter regarding this topic as well as for the others topics. Find out more details in the sections below.
See you soon,
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| Steffen Köhler
| COO | EEX
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| | Political update | |
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| February was a big month for European Climate Policy and the future of carbon markets in the EU with no less than two strategic publications and one political agreement on an upcoming law.
First, in the Communication on Europe’s 2040 climate target and path to climate neutrality, the EU ETS once more takes center stage. It is expected to continue to provide strategic support for innovation, have a role in scaling negative emissions and continue to provide a central common carbon price.
Second, the Industrial Carbon Management Strategy for the first time explicitly references captures/stored CO2 as a “tradable commodity” with a close link to the EU ETS which will be determined in the coming years.
Last but not least, the EU negotiators reached a political agreement on an EU Carbon Removals Certification Framework, which will set up an EU registry for certified carbon removal credits. As the lead negotiator for the Parliament highlighted, this step should foster investments and voluntary carbon markets in Europe.
We are already excited to continue discussing how these milestones will continue to shape European carbon markets. We hope you’ll enter in that conversation with us!
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FOR ALL VIDEO CONTENT MAKE SURE TO CHECK OUT EEX TV
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| | North American Update | | Environmental products on Nodal Exchange posted a record Q1 with more than 120,000 contracts traded, up 75% from the first three-month period a year earlier. Open interest at the end of Q1 topped 326,000 lots, up more than 40% from 226,306 lots a year earlier. Environmental markets on Nodal also hit a new open interest record during the quarter of 326,101 lots.
In February, environmental market volume on Nodal Exchange set a new monthly record of 50,085 lots, topping the record of 47,007 lots in November 2023. Volume for the month was up 134% from 21,388 lots in February 2023. These records highlight the work that Nodal and IncubEx have done to build these markets since November 2018. Nodal lists the largest suite of environmental products with more than 120 futures and options.
Broken down further, Nodal posted gains across renewable energy certificate (REC) and renewable fuel credit product sets. Open interest across all REC products hit a new high during Q1 of 263,172 contracts, while renewable fuels surpassed 46,000 lots. California Low Carbon Fuel Standard futures and options open interest continued to rise, topping 45,000 contracts of open interest, up more than 40-fold from a year earlier.
REC products continued their growth trend in open interest, with Texas CRS wind and CRS solar futures topping 62,000 contracts, also a new high, up nearly 40% from a year earlier. Texas CRS lead the group of 5 voluntary REC products listed on Nodal: Texas, NAR, M-RETS, WREGIS and National. Combined, voluntary REC open interest surpassed 70,000 lots during Q1, up 48% from a year earlier. That equates to more than 70 million MWh of renewable energy.
The drivers for trading RECs on Nodal are compelling, with capital efficiencies and clearing, participants continue to trade these products to meet renewable power goals. IncubEx and Nodal see further growth potential across the product suite as more participants access these dynamic markets.
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| | | E-World Recap | |
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We’re thrilled to have seen so many of our partners at E-World again this year!
You can check out the photos here.
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| | nETS Webinar | |
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EEX conducts the sale of nEHS certificates (nEZ) in the German national emissions trading system and cordially invites you to participate in this webinar which is especially dedicated to address the new obligated parties as per BEHG from 01 January 2024 onwards.
Date: 04/03/2024, 10:00 - 12:00 a.m. CET
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| | | EU ETS Webinar Recap | |
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It is crucial for shipping companies to stay informed about timelines, key dates, and their next steps for accessing EU ETS allowances. Get the slides from our EEX Experts as well as presenters from ABN AMRO Bank N.V., ACT Financial Solutions B.V., Berenberg, CFP Energy, Grey Epoch, and Vertis Environmental Finance.
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| | Meet us at REC Market meeting | |
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We’re looking forward to REC Market Meeting in Amsterdam, 16-17 April, the global annual meeting point for the renewable energy industry. Join our experts to discuss registries, GOs and much more.
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