ETS auction wipes millions of credits at year-end

Posted: 11 Dec 2023

The final Emissions Trading Scheme auction of the year failed to clear the 15 million carbon units on offer, signalling a tightening of supply heading into the new year, possibly to push carbon prices higher.
 

ANZ senior economist Susan Kilsby said having the 15 million NZUs wiped would result in a tightening of total unit volume in a market that has been oversupplied for some time. 
 

Estimates done by her are that the NZU stockpile consists of 141 million units, despite only having demand estimates of about 43 million units. 

She said that, perhaps surprisingly, the NZU price took a drop after the auction’s failure, sliding from $71 a unit down to $65.

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