1. Alexandre Kossoy Philippe Ambrosi

2. Overall Market showed resilience
(in Billion US$)
144
135 65 31 11
0.7 2

3. Allowances up, offsets down
(in Billion US$)
+1000%
Assigned Amount Units
RGGI JI
2.0
2.2
.35
EU ETS Allowances
118.5
-33%
+626%
CDM
Secondary CDM
2.7
17.5
+18%
-59%
Chicago
Climate
Exchange
.05
Voluntary
.12
New South Wales Certificates
.34

4. EU ETS: mainstreamed in the EU
EUA, secondary CER & primary CER prices
(€ per tCO2e, strip)
Long Phase II with lower industrial activities; (-11% emissions in 2009)
EUA sell-off raises cash in credit-tight environment
Haunted by challenges, swift response
EUAs
sCERs
pCERs 4

5. CDM & JI Market Value Halved
volume (MtCO2e)
price (US$/tCO2e)
Activity declined markedly
reduced compliance needs
less origination by intermediaries
competition with AAUs
uncertainty on post-2012 rules
Price declined too, but did not collapse
interest in sound and viable projects
How long will CDM & JI continue to catalyze low-carbon investment? 5

6. CDM & JI Buyers
2009 6

7. Who’s selling ?
2009
(share of volumes) 7

8. CDM Sectors
2009 8

9. Contracted (risk- adjusted)
Low Residual Demand
2012 demand down 25% to 1.22 billion tCO2e
1.18 billion tCO2e contracted
1.02 billion CERs & ERUs contracted (risk-adjusted)
163 million AAUs contracted
Not all have purchased what they need:
residual demand of 230 MtCO2e
Large post-2012 headroom under EU Package (and other initiatives)…
2,127 MtCO2e
AAU
230 MtCO2e, mostly from EU governments
1,181 MtCO2e
1,222 MtCO2e
CDM
& JI
AAU
CDM
& JI
Contracted
(nominal)
Contracted (risk- adjusted)
KM Demand 9

10. Navigating a bottom-up, fragmented carbon market
After E. Fages, 2010
Stop-gap solution while international negotiations do not pick up
Powerful, bottom-up drive leading to broader local acceptance and participation
Low liquidity and inefficiencies without fungibility across regimes
Long maturity time with large capacity needs

11. Full report available at www.carbonfinance.org
Thank you
Full report available at