EU ETS reaches record highs

Utility hedging and a tighter supply-demand balance are boosting prices, but falls still expected later in year

Prices in the EU emissions trading system (ETS) reached above €100/t CO₂ ($106/t CO₂) last week and hit their highest-ever closing level. Although not quite rising to the record high of €102/t CO₂ from last August—stopping just short at €101.19/t CO₂—the market has breached €100/t CO₂ for five of the last six trading days and average closing prices last week were the highest ever. Previously, when the market has risen to this level it has quickly fallen back as traders sold positions to lock in profits from the rallies. But profit-taking has failed to materialise this time, with traders betting the market could still rally further and breach the all-time high. 16pc — Amount of EU’s ele