In late January 2014 the EU Commission proposed a MSR along with the 2030 Framework for Climate and Energy Policies. The proposed legislation of the commission amends the design of the EU ETS by introducing a reserve, making the supply in the EU ETS flexible. The reserve would, in times of high oversupply, reduce auction volumes and consequently the market supply while in times of low over-supply volumes from the reserve would be auctioned.
Philipp Ruf, lead analyst at ICIS for EU carbon markets says that:
"The current commission's MSR proposal is the right step in the right direction to reform the EU ETS as the envisaged goals of tackling the market's supply-demand imbalance, creating a robust carbon price signal, assuring inter-temporal efficiency and making the system more resilient against external shocks are achieved. However, our analysis of the proposal shows that there is also the need to further optimise the proposal".
Drawing on ICIS' 30 years' experience of providing pricing information, news, analysis and consultancy to buyers, sellers and analysts the White Paper ICIS intends to contribute to the currently on-going stakeholder discussion around the long-term structural reform of the EU ETS. Accompanying the White Paper, ICIS will host an exclusive webinar on the 10th July at 10.00am (BST) to further elaborate on the MSR functioning and its anticipated market impact as well as the possible optimisation of the reserve.
Webinar- What impact will the EU ETS Market Stability Reserve (MSR) have on the market and how can its design be optimised?"
Date - 10th July 2014
Time - 10:00am GMT (London)
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