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2023-02-22T10:00:49+01:0021.February 2023|


CO2 prices hit record high: Causes, expectations and what companies should do now

By Nikolas Sachs, MBA – Associate Manager at denkstatt

In 2019, a scenario, in which the EU Emission Trading System (ETS) CO2 price might hit 100 EUR/t by 2030 was a high-case scenario from an expert’s point of view. At the time, a CO2 price of 25 EUR/t already felt overly high and projecting 100 EUR/t for 2030 felt like a stretch. On February 20th, 2023, the price of a certificate for a ton of CO2 emissions within the EU ETS hit 100 EUR/t for the first time.

Reasons for rising CO2 prices and what we have to be prepared for
Short-term volatility and long-term uncertainty of carbon prices will remain high as large corporations and investors are hedging and speculating on the CO2 price, all while we are already operating in a VUCA world surrounded by uncertainty. What is certain, however, is that CO2 prices are bound to expand in geographical and industry scope, as well as in price, so here are a few ways in which companies can prepare and manage these uncertainties.

Reasons for rising CO2 prices and what we have to be prepared for

  1. Reduce your emissions
    The most effective and sustainable action is to reduce your risk exposure by reducing your CO2 emissions as soon and as much as possible.
  2. Apply an internal CO2 price
    Prepare your organization for upcoming prices and regulations by applying an internal CO2 price, for example for use in CAPEX investment decisions, purchasing decisions (TCO) or business travel.
  3. Work with scenarios
    Evaluate how different factors affect your business decisions and financial results. A new high-case scenario for EU ETS prices could be as much as 200-400 EUR/t by 2030, with National CO2 prices in Western EU countries between 120 and 140 EUR/t.

How we support you in handling CO2 prices
We provide support where sustainable values need to be created. denkstatt has been accompanying its customers on their path to a sustainable and future-oriented business model for 30 years. Our extensive references and diverse cooperation prove our expertise. Feel free to contact us regarding possible next steps your company is thinking about.

Reach out to: Nikolas Sachs, Associate Manager – nikolas.sachs@denkstatt.at

Current CO2 prices
Modelling of necessary CO2 prices to achieve the European climate targets 2030

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