KfW/ZEW CO2 Panel 2009: Leaving the Trial Phase behind – Preferences & Strategies of German Companies under the EU ETS

As part of a cooperative project with KfW Bankengruppe, the Centre for European Economic Research (ZEW) is conducting a market survey among participants and experts of the EU Emissions Trading Scheme. The goal of the project is the analysis of the EU market for emission allowances and its development. The results are reported in an annual publication and a biannual report. Main Results of the Survey: Economic Downturn Impedes Emission Assessment but Spurs Trading Activities of German Firms. Only a Small Minority of Companies Seems To Be Trading on a More Regular Basis. Firms Were Actively Selling Surplus EUAs thus Using Them as an Instrument in Their General Liquidity Management. The Energy Sector Turns Out To Be the Most Active in Spot and Forward Markets for Emission Allowances. Market Development Still Hampered by Inherent Risks and Uncertain Economic Outlook. The Strong Presence of German Companies in CO2 Markets Indicates that Firms Are Adapting to the new Regulatory Framework Under the EU ETS. Price Signals Still Seem To Be too Weak to Have a Significant Impact on Investment Strategies. Market signals will Strengthen – Prices Expected to Increase Moderately in the Short Term but Show Significant Upward Trend Over the Mid- and Long Term Horizon.