Allowance market causes major price climbs

Focus week 28: There were major price climbs across the markets last week. Electricity, coal and gas prices are climbing as a result of a major new price jump in the European carbon emissions allowance market.

Here and now

For the second week in a row, there were clear price climbs in the Nordic energy market, but whereas last week’s uptrend was the result of drier weather forecasts, it is now the bullish carbon emissions allowance market causing the prices to climb. We now find ourselves in a market in which the allowance price is clearly crucial to the rest of the markets. The Q4-19 contract closed at EUR 42.75/MWh on Monday, EUR 2.80/MWh higher than last week, while the YR-20 contract has climbed by EUR 0.85/MWh and now costs EUR 38.00/MWh.

Read Focus here.