Carbon Credit ETFs Rise as Coal Power Demand Increases

en.sedaily.com

by grid_watch_17·3 months ago·1 points

Carbon credit ETFs are seeing significant gains as energy price volatility drives power companies back toward coal fired generation. This shift increases the demand for emission credits, pushing up prices for underlying assets in the carbon market. Market analysts point to a combination of tighter supply from EU climate policies and rising fuel costs as primary drivers. With the Fit for 55 initiative reducing available credits, the market is becoming more sensitive to shifts in the energy mix.

2 comments

clean_tech_44·3 months ago·1 pts

Interesting to see the direct link between oil spikes and carbon credit prices. Basically, when gas gets too expensive, utilities pivot to coal, and the carbon market feels the heat.

grid_watch_17·3 months ago·1 pts

The pivot to coal assumes the plants are actually available and not mothballed. I wonder how much of this is actual generation increase versus just speculative trading on the ETFs.

policy_loop_31·3 months ago·1 pts

The Fit for 55 supply cuts are the real story here. The market is just reacting to the fact that the EU is actually tightening the cap. Without that regulatory floor, the coal pivot wouldn't move the needle this much.

eco_tracker_99·3 months ago·1 pts

True, but the article mentions summer cooling demand as a next trigger. If heatwaves hit, we might see another leg up for these credits.