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United States

Carbon Trading

As interest in carbon markets grows throughout the US, we can draw upon our extensive first hand experience of the way in which the EU ETS has evolved - from its design, through to its implementation and now into its third year of operation - to offer our clients insight and advice on developing CO2 markets.

Developing a carbon market is likely to be far more challenging than those for SO2 emissions although the potential stakeholder consequences are arguably much greater. Among the greatest challenges is estimating market price levels, especially before the market has started and Phase 1 price levels have been too low to deliver significant abatement in emissions. Phase 2 should, and most likely will, be built on better foundations - for example in allocation methodologies - but stakeholders still have lot to play for in the EU ETS beyond 2012.

Please click here to see more information on Pöyry capabilities in developing carbon markets.

Areas in which Pöyry could help US organisations:

• Advocacy support for stakeholders at a State, Regional and Federal level

• Advice on market design drawing on experience in the EU ETS

• Commercial strategies in a rapidly developing carbon meeting

• Carbon abatement impacts on power markets

• Emission allowance allocation methodologies

Example projects:

• Impact of CCS on gas markets (Confidential client, 2007): Developed market evolution scenarios for CCS in both a European and worldwide setting in order to assess the potential impact of CCS on gas demand. The work used an economic appraisal of the full CCS chain and set CCS in the context of the wider power market.

• North Sea Infrastructure Analysis (BERR, 2007): Project for the North Sea Task Force (British and Norwegian Governments) jointly considering development of EOR in combination with Carbon Capture and Storage. The project extended on previous work to incorporate changes in the EPC scene and produced a full economic evaluation of alternative pipeline networks.

• Economic CCS supply curve evaluation (DTI, 2006): We developed a complex economic model for all UK large emission sources in order to develop a complete view on the potential for CCS in the UK. The project optimised the transport system to use the lowest cost fields and matched capture technology to plants, integrating with existing in house power system models.

• Supply of world-wide carbon market modelling services to UK governmental departments (DTI, 2005-2008)

• EU ETS market price forecasts

• Various work with the WWF to review impact of EU ETS (2002 - 2006)

• Analysis of allocation principles for co-generation projects for an International Oil and Gas company - Romania (2006)

• Treatment of cogeneration in EU ETS Phase 2 (DEFRA, 2005 - 2006)

• Estimation of national allocation plans (NAPs) from an oil refining point of view, (Neste Oil Oyj, 2005)

Contacts

Phil Hare, Director

phil.hare@poyry.com

+447770 828644

Andrew Nind, Director

andrew.nind@poyry.com

+441865 812238