From Bloomberg via Energy Connects, March 21:
UK carbon jumped to the highest level since June after a minister said that the UK is discussing linking its carbon market to the larger trading system in the European Union.
The comments are the latest by the government to suggest a potential linkup, while giving little detail about the likelihood or timeframe. Yet the possibility has spurred a recent rally in UK carbon permits, which trade at a discount to the EU equivalent.
“Ahead of the UK-EU summit on May 19, the UK government is actively considering the case for linking,” Philip Hunt, minister for energy security and net zero, said in a written response to a question in the House of Lords published late Thursday. “This does not prejudge the outcome of any potential discussions with the EU” on the matter.
UK carbon futures rose as much as 5.3% in early Friday trading to £49 per metric ton, the highest level since June 20.
Spencer Livermore, financial secretary to the Treasury, said last week that the government was exploring all options to improve trade with the EU, including potentially linking up emissions systems. Earlier this week, a body that includes members of the UK and European parliaments renewed a call to consider connecting the markets.
UK carbon futures for December have gained more than 20% since Livermore’s comments last week, narrowing the spread with EU permits to near the lowest level since last October....
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