EU Carbon Options Had Record Volume in February as Price Hit All-Time High (1)

By Mathew Carr

March 5, 2021 — LONDON: There was record volume of EU carbon options traded in February, said exchange operator ICE.

There was a total volume of more than 412,000 options contracts, a record average of more than 20,500 per day.
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The ICE Global Carbon Futures Index value (ICECRBN) reached a record on Feb. 12, with a weighted average price of $39.08/ton, the exchange said.

EU allowances, which make up most of the index, closed that day above 40 euros for the first time, as policy makers in the region and beyond are seen tightening climate measures.

The index measures the performance of a long-only basket of EU futures, California Carbon Allowance (CCA) futures and Regional Greenhouse Gas Initiative (RGGI) futures. It’s calculated and published in real-time.

EU carbon futures have not closed above 40 euros since:

From ICE:

See this for some context:

“When ICE first entered the environmental markets, these were nascent, niche markets. Today they are among the fastest growing markets globally, offering a transparent, accessible and market-led route for the world to price climate risk on a global scale”, said Gordon Bennett, Managing Director of Utility Markets at ICE, in an emailed statement.

“As climate risk and the energy transition impacts more and more companies regardless of sector, a broad set of solutions will be required to help the adoption of wider and more ambitious cap and trade programmes, complemented by offset markets which encourage investment in high quality, credible projects.”

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