EU
The European Union Allowance (EUA) prices for February averaged at EUR 76.97 per tonne, down 0.65% from the previous month. At the beginning of the month, EUA prices remained at a high level but gradually declined over the course of February, settling around EUR 72 per tonne by the end of the month.
Several factors contributed to this price decline. The global economic slowdown led to a weaker outlook for energy demand, exerting downward pressure on the market price. Additionally, fluctuations in natural gas prices prompted shifts in the power generation mix, with some power producers transitioning to low-carbon energy sources, reducing the demand for carbon allowances.
Furthermore, changes in market expectations regarding future carbon allowance supply intensified downward price pressures. As the market adjusts its supply and demand outlook, combined with potential new requirements under the EU carbon border adjustment mechanism, the future trajectory of EUA prices remains uncertain.
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China
The China Emission Allowance (CEA) prices for February averaged at RMB 91.77 per tonne, down 3.15% from the previous month.
At the beginning of the month, CEA prices remained above RMB 93 but gradually declined, falling below RMB 90 per tonne by the end of February—the lowest level in four months.
The price decline was primarily driven by a global economic slowdown, which led to reduced overall energy demand and, consequently, lower demand for carbon allowances. Additionally, some power producers reduced their demand for carbon allowances as their emissions decreased. Moreover, the market remained cautious in anticipation of potential policy changes, while compliance-related trading activity declined following the end of the compliance period.
Looking ahead to March, CEA prices may stabilize as seasonal energy demand increases with the arrival of spring. Furthermore, some companies are expected to start preparing for future emission reduction regulations, potentially supporting price recovery.