Many people think the cost of carbon is too cheap and should be at least £20 or more per tonne, according to a new survey.
The poll, by carbon offsetting company
Carbon Retirement, also reveals that most people over-estimate the
price of a tonne of carbon.
Out of the 62 people who responded to the survey, over a quarter thought a tonne of carbon cost somewhere between £15 and £20. A further 10 per cent thought a tonne of carbon cost in the £20-£30 range, while 16 per cent thought the cost was over £30.
Fixed prices on a tonne of carbon are currently around £13 under the Clean Development Mechanism (CDM) and £14.50 for allowances under the
EU Emissions Trading (EU ETS), although most carbon credits don’t have a fixed price.
When it came to setting a price for carbon, two-thirds of respondents said it should be £20 or more for a tonne, while more than 25 per cent of respondents said the price should exceed £50. A tenth said it should be £100 per tonne or higher.
Commenting on the survey findings, Jane Burston, director of Carbon Retirement , said she expected carbon prices to increase.
"The prices of CDM credits and EU Allowances have increased in recent weeks, with their current prices being the highest for over a year," she said. "A combination of factors are responsible: European economies emerging from recession, power generators signing three-year supply contracts with customers and buying up credits to match their predicted output, and anticipation of a large shortfall of allowances from 2013, when the cap on
emissions from industries covered by the EU Emissions Trading Scheme is tightened further."
Datamonitor forecasts EU Allowances will push through €20 barrier this yearThe Carbon Retirement survey findings coincide with a new report out by business information provider Datamonitor, today, which forecasts that the price of EU Allowances will climb to more than €20 (£17) by the end of the year.
"In the short term, EU carbon prices will be challenged by market worries over Greece's sovereign debt crisis, as well as the possibility of sovereign default in Spain and Portugal," said Alex Desbarres, senior renewables analyst at Datamonitor. "However […] "EU carbon prices are expected to
trade around their current levels throughout Q2 and Q3 2010. However, prices will gradually rise towards the back end of Q3 to break through the €20 psychological barrier by the end of the year, driven by heightened industrial output and expectations of much tighter conditions in Phase III [of the EU ETS]."
Related news:Carbon trading newsRelated links:www.carbonretirement.comwww.datamonitor.com