EP rejected the promotion of a market of emission allowances
Members of the European Parliament failed to support the carbon market. The European Parliament rejected the proposal to delay the supply of allowances in the third allocation period. CO2 allowance price fell by 35% to 3 EUR / t price of electricity by 3% to 39.6 EUR / MWh. This influenced the sector of electricity producers. Consequently, the share price of CEZ repudiate 2.9% (567 CZK). The report is negative for the whole sector companies engaged in the production of electricity.
The European Commission will have to find other ways to make an emissions trading. This, according to us it may take a year or two and the price of emission allowances is likely to continue to fall below 3 € a negative impact € 1.6 per MWh for base-load electricity prices. CEZ has a positive lever on the price of emission allowances in the long run approximately 0.2 (almost 0.1in the short term). Since the proposal to postpone the issue of emission allowances was one of the few potential factors for the increase in electricity prices, we expect that the impact on market sentiment will be even worse.
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