The Union Registry has published the first verified emissions for the EU ETS 2. We have compared the figures against Veyt’s model estimates.
Emissions higher than expected. For the countries where verified data are available, reported emissions are 8 percent higher than our model forecast.
Incomplete dataset. Several countries are still missing, including Poland, Romania, Hungary, Bulgaria, Portugal, Latvia, Lithuania, and Cyprus, so the final outcomes remains uncertain.
Deviation above ETS1 levels. The 8 percent gap is larger than the typical 1–2 percent we see in ETS1. However, given that ETS2 is a new system without historical reference points, this level of error should not come as a surprise.
Our 2024 estimates were extrapolated from 2023 verified emissions using the 2022–23 decline rate. Since the 2022–23 drop was relatively steep, the assumed 2023–24 decline may have been overstated, leading to an under-estimation of current emissions. We are investigating further.
We will incorporate these verified emissions into our modelling over the coming weeks. All else equal, higher-than-expected emissions will imply somewhat more bullish pressure on ETS2 prices than in our current outlook.
(See chart below for comparison of Veyt’s model and verified emissions)
The Netherlands was the first country to publish its verified ETS2 data earlier this year. That release already pointed towards higher-than-expected emissions (10% higher than in our modelling) and emissions being concentrated among a few large players. In 2024, the top 25 entities account for around 75 percent of Dutch ETS2 emissions, with Shell alone responsible for more than 4 MtCO2.
A key conclusion is that it will be difficult to disentangle where these emissions originate. Many of the largest reporting entities supply both oil and gas, and their activities cover transport, buildings, and smaller industrial consumers. This means it could be challenging to draw a clear line between demand from the different sectors covered under ETS2.
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