Italian emissions trading set to restart
Italian power market operator GME will resume emissions trading on 15 January, following the issue of 2008 allowances to Italian installations, undertaken in December.
As a first stage, GME plans to only hold market sessions on a weekly basis, with trading taking place each Wednesday from 15 January. The last weekly session announced so far is on 26 March.
Trading at GME’s platform has been suspended since 30 April 2008, due to the late arrival of 2008 allowances.With the restart, GME has given the platform an upgrade in a bid to boost liquidity. The market operator is now going to assume the role of central counterparty, rather than trading counterparty, while the minimum tradable lot has been reduced from 500 to 100 units. The group is also introducing a basket of orders, for entry of multiple buy or sell orders.
In the future, members will be able to cancel all buy or sell orders simultaneously, suspend orders entered into the order book to then re-enter them automatically and change the number of units on their accounts or raise their cash deposits for purchases during the session.
Of the 46 companies currently signed up to GME’s platform, most are smaller industrials. The dominance of small industrials means most participants are long, with traders remarking that offers used to outweigh bids on the platform. This is one of the reasons for the lack of activity on the platform, they say.
Another is that Italian companies have been able to trade through an arm of the Mediterranean trading platform Sendeco2 since April 2007. The Italian branch of Sendeco2 reported 2m transactions in 2007, compared with just 74,000 tonnes of CO2 equivalent (tCO2e) at GME’s platform. In the first four months of 2008, before GME idled the platform, a total of 8,000 tCO2e traded. IS
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