Swaps

Installations and airlines are allowed to use CERs from Kyoto Protocol projects (CDM or JI) for compliance in the EU ETS. The number of Kyoto credits which can be used depends on the rules of different member states. In Phase II, this varied mainly between 0% - 22% of the allocation across the EU for stationary installations and it was a fixed 15 % of the verified emissions for the aircraft operators.

In Phase III, stationary installations can also use Kyoto credits. The number that can be used in Phase III is (A) the higher of (i) the number which could be used in Phase II and (ii) 11% of the total allocation in Phase II (B) less the number if Kyoto credits actually used for compliances in Phase II. Aircraft operators also shall be able to use credits up to an amount corresponding to a percentage, which shall not be set below 1.5 %, of their verified emissions during the period from 2013 to 2020.

The opportunity

As Kyoto credits cost less than EUAs, installations can save money by purchasing and using Kyoto credits rather than EUAs for compliance. The EUA-CER spread is the difference in price between EUAs and CERs. Historically this has ranged between €1 and €10. Check the current spread on myvertis.com.

As a result of this, many companies like to swap EUAs for Kyoto credits by selling EUAs and simultaneously buying Kyoto credits. It is a risk-free way of raising additional cash or compliance units. Some companies also trade the spread, buying and selling the spread as it moves up and down.

Please download the VERTIS SWAP TRANSACTION (PDF, 89.2 KB) product sheet.

vertis blog


Vertis enters renewable energy market and is member of RECS International
25 September 2017
Vertis Environmental Finance started the trading of Guarantees of Origin (GOs), a special tracking certificate that labels...
Vertis acquires Alco2
18 September 2017
Vertis Environmental Finance has completed the acquisition of Alco2, the Brussels based emissions trading firm. Alco2 team...
Vertis voted 2017 Best Research in Emissions by Energy Risk users
11 August 2017
In the survey by the top commodity and energy risk journal, Energy Risk Vertis has been voted 2017 Best Research in Emissions...

trading room


EUA Dec17: Price heads back into trend channel
25 September 2017
Lower power prices and the deteriorating profitability of coal fired power plants weighed on the price of carbon last week...
EUA Dec17: Price might consolidate near 7 euro
18 September 2017
Despite hitting the highest level in 2 years at 7.72 euro last week, the EUA Dec17 finished the week 1.7% lower in a weekly...
EUA Dec17: Investors focus on the trilogue negotiations Wednesday afternoon
11 September 2017
The EUA Dec17 gained more than 1 euro in one week and hit an almost 2 year high on Friday. The benchmark carbon contract...

the bustard blog