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German carbon auction platform to be ready this year

09 Jan 2012 15:42:39 | edcm

Germany is still deciding who will run its national auction platform in phase III of the EU emissions trading system but pledges the platform will be operational in the second half of this year, when the first auctions to airlines and other emitters for 2013 are due to take place.

More than half of all EUA are estimated to be auctioned during phase III but Germany - Europe's biggest emitter - has opted out of the EU's unified auction platform, citing concerns about competition in the secondary carbon markets.

According to the German carbon registry, DEHSt, if all EU auctions were to take place on one bourse, the secondary market would likely also concentrate on that bourse.

This would harm competition between different bourses, a DEHSt spokeswoman said.

And if an exchange was to fall victim to market manipulation or technical problems, disruption to the market would be exacerbated if trade was concentrated on that one platform, a spokeswoman added.

UK and Poland

The German environment ministry, of which DEHSt is a division, is currently in the process of awarding a mandate for the organisation of Germany's phase III auctions.

The UK - Europe's second biggest emitting country - also plans to stay outside the common auction platform, as does Poland.

The UK wants to defend what it perceives as its financial sector's pole position in the carbon markets in terms of trade going through, and has also cited competition as a reason to retain its own auction platform (see EDCM December 23 2011). MD

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