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Poland to launch tender for emissions auction platform in 2014

20 Jun 2013 17:46:15 | edcm


Poland plans to open the tender to select its own permanent auction platform in 2014, as necessary legislation needs to be passed before, the country's environment ministry told ICIS on Wednesday.

Poland, Germany and the UK are the only EU states that chose to opt out of the common auction platform and to select its own instead, but Poland is the only one not yet auctioning phase III EU allowances (EUAs).

The ministry said the country is finalising the transposition of the EU Emissions Trading System (ETS) directive into national law, which is a necessary step to start the tender.

"The tender for the permanent platform will be launched as soon as the legislative process is over. We plan to finish the legislative process this year and start the tender at the beginning of 2014," it said.

Access will be open to participants from all EU countries and trading will be in euros, the ministry added.

Earlier this year, the Warsaw stock exchange auctioned a small amount of Polish phase II EUAs, with sources saying that this might indicate the exchange is becoming the front-runner for hosting phase III sales (see EDCM 13 March 2013).

Poland to temporarily join EEX

While waiting to select its own permanent auction platform, Poland will temporarily join the EU common platform "in three/four months", the ministry said.

This means that after the summer additional EUA volume will add up to the amount already auctioned every week by German-based EEX, which is holding auctions on behalf of the European Commission and EU countries as temporary common platform.

Polish utilities including Tauron, PGNiG and Energa are already included in the EEX auctions participants list, while the country's biggest utility PGE instead does not result in the list. Polish utilities are among those covered by derogation, meaning they will still receive 404.7m free permits in phase III, as opposite to power generators in most European countries which have to buy all their allowances (see EDCM 13 July 2013).

With additional volume from Poland, the German-based exchange could even increase its auction market share above the current 85%. The only EU country not using it is the UK, which is selling its EUAs on London-based ICE Futures Europe. EEX has so far auctioned some 330m EUAs in 2013, out of an expected total of 724m.

The amount of EUAs auctioned annually is expected to increase progressively throughout phase III, as the percentage of certificates allocated for free will decrease from 80% in 2013 to 30% in 2020. The ETS legislation aims to phase out free allocation by 2027.

EEX German permanent platform

Separately, the Commission announced this week that the Climate Change Committee supported Germany's choice to make EEX - currently the country's temporary auction platform - its permanent platform.

The draft amendment to the auctioning regulation will now be submitted to the European Parliament and the Council. If they do not object in the next three months, the Commission will adopt the measure, with EEX expecting the entry into force for October. The nomination will last three years, with the possibility of an extension for a further two years.

The tender for the selection of the permanent common platform is not expected before the summer (see EDCM 5 June 2013).

EEX has recently announced plans to spin off its carbon spot and derivatives market into an independent company as of 1 January 2013 under the name of Global Environmental Exchange to make "collaborations with other trading platforms" easier. Silvia Molteni

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