More Layoffs for Carbon Brokers in London
The European carbon emissions permit trading space continues to shrink as more layoffs of carbon brokers continue in London due to the recession and not enough demand for carbon credits, reports Reuters.
As an example, CantorCO2e laid off its last three carbon brokers in the UK earlier this month, according to Reuters The company also closed offices in India, Brazil, Chile and Mexico in the past 12 months, and sources told the news agency that the New York and Houston offices would handle European clients.
Reuters says this follows cutbacks at other emissions brokers including Carbon Capital Markets, which closed its trading desk in April.
What’s happening is that energy brokers that entered the $144 billion global carbon trade market a few years ago are losing business to emissions exchanges such as London’s European Climate Exchange (ECX), while also trying to deal with shrinking demand after the EU cut emissions by over 11 percent due to the recession, reports Reuters.
As a result, analysts told the news agency that companies will not have to buy permits, or EU allowances, until 2013. EUA prices are trading at 12 and 16 euros in the last year, below the all-time highs of near 30 euros in July 2008.
In an attempt to revive carbon trading, European regulators and businesses recently proposed a supplemental “green bond” system that would function with the current cap-and-trade scheme.
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