The compliance deadline for the submission of allowances for 2022 emissions is right around the corner. Scheduled at the end of this month, more than 700 ETS-covered companies will be obliged to submit KAU22 allowances on August 31, 2023 (Thursday).

Ecoeye’s market research team has made a summary of companies’ disclosed information as of July 2023.

• 2022 Certified Emissions

Certified Emissions from ETS companies totaled 572.12 million tons, a decrease of 3.2% from the previous year (-18.9 million tons). Certified emissions from each sector were: energy conversion/power at 229.83 million tons (40.2%), industry at 316.09 million tons (55.2%), buildings at 4.96 million tons (0.9%), transport at 6.73 million tons (1.2%), and waste/public/others at 14.51 million tons (2.5%)

• 2022 Allowance Allocationo   Free Allocation - a total of 568.22 million tons were distributed for free, including an additional quota of 29.39 million tons and 3,159 tons of cancelled allowanceso   Auction - a total of 12.61 million tons of KAU22 allowances out of the total sale of 18.24 million tons was sold in auctions

• Offset Credits - as of the first week of August, a total of 7.14 million tons of offset credits were converted to KCU22 by 58 companies, of which the energy/power accounted for 49.8% followed by industry (49%), waste/public/others (0.9%), and buildings (0.3%)
• Allowance Balance

Ecoeye calculated the expected excess and shortage to be around 19.7 million tons of KAU22, ± 3 to 4 million tons of KAU22 depending on banking situation. Data showed that net purchases occurred in the energy and power generation, waste/public, and building sectors, while net selling of approximately 10 million tons was recorded on the sectors of industrial complex, collective energy, industry and transportation sectors. Market makers and brokerages have a total combined 3.43 million tons of net purchases.

The figure above appears to be consistent with the previous forecast we made on our S&D report published exclusively for Ecoeye subscribers.

Note: All data compiled from the ETRS by Ecoeye