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Weekly Carbon Outlook – May 30, 2017

May 30, 2017 by Billy Hamshaw

(See below to download report)

Trading Report

  • 6,632,000 tons traded in a stable week for the CCA market
  • New front contract, Jun 17, cleared on Friday at USD 14.05, USD 0.01 above the previous week’s close
  • A net change of 4,764,000 observed on open interest creation
  • OCA’s Dec 17 benchmark dropped to CAD 19.15 (USD 14.23)

Price Expectations

  • AB 378 moved to floor with much higher focus on air pollution reduction and inclusion of more type of air pollutants in cap and trade
  • Recent fully subscribed auction resulted into quarterly surplus of over 16 million of allowances.
  • Expected V17 ranges: $14.00- $14.10 (Front); $14.20- $14.28 (2017 Benchmark)

CCO Tracker

  • 5 million ARBOCs become live after a record-breaking issuance
  • Wyoming IFM (ACR249) gains a seismic 4.4 million CCOs for project developers Encourage Capital and The Forestland Group
  • New forestry projects come online as deadlines approach

Policy Tracker

  • SB 775 – It would now no longer allow banking of allowances and use of offsets in the cap-and-trade program beyond 2020. It also prevents free allocation of allowances and thus incentivise industry to invest in cleaner technology.

Key Dates

  • June 02 – ARB Public Working Meeting for evaluation of the carbon intensity of renewable fractions, quantifying and reporting the renewable fuel volumes, and monitoring and verification under the Low Carbon Fuel Standard.
  • June 06 – Ontario cap-and-trade auction 2 for greenhouse gas allowances.

Download this report (pdf)

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