The price development of EU emission allowances (EUAs) is decisively influenced by the electricity market in the EU. Higher demand for electricity often leads to rising EUA prices, as the increased use of fossil fuels use of fossil fuels requires more emission allowances. But this is only part of the story. Factors such as fuel prices, technological advances and regulatory measures also play a significant role. In our latest publication, we analyse these diverse influencing factors and and venture a well-founded outlook on the future price development of EUAs. Discover the dynamics driving the market and what the future holds …

Asset managers issue climate pledges In recent years, many asset managers have committed to reducing the CO2 footprint of their portfolios. For example, if you want to keep your portfolio on a 1.5-degree path, you currently have to reduce the CO2 footprint of your portfolio by around eight percent per year. If all companies were to align their eco-nomic activity with this target, the world as a whole would also be on a 1.5-degree path and the footprint of each portfolio would auto-matically follow this path. However, as this is not the case, it may also appear sensible and expedient …

Integration into the EU ETS This year, international shipping will be inte-grated into the EU Emissions Trading System (EU ETS) alongside the energy sector, ener-gy-intensive industry and aviation. This inte-gration is intended to contribute to a further significant reduction in greenhouse gas emis-sions. Globally, shipping accounts for around 2.9% of CO2 emissions, while in the EU this figure is 3.7%. The new regulations provide for a gradual introduction of the obligation to purchase emission allowances for shipping. Specifical-ly, this means that from 2024, 40% of emis-sions must initially be covered by EUAs, with this proportion rising to 100% by 2026. …

It is not always so easy with regulation. What was well-intentioned on the part of politicians can sometimes lead to a certain amount of frowning on the part of investors in practice, as the still relatively new regulations do not always have the necessary degree of maturity that investors would like to see. A good example is the EU Disclosure Regulation. The basic idea behind the Disclosure Regulation is easy to explain: in principle, it is about creating incentives to channel as much capital as possible into areas that enable or promote a sustainable economy. The Disclosure Regulation helps to …