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Carbon Price Projections for the EU ETS

The EU ETS is evolving, and the carbon price is more impactful than ever before.

In the last year, carbon prices have proven resilient in the face of the COVID-19 pandemic and risen to new highs, reaching prices above €40/tCO2 for the first time in the history of the EU ETS.

The European Green Deal is ambitious and will need strong policy support to become a reality. This coming year will see a 2030 target decided on, new EU ETS targets discussed, and a carbon border adjustment mechanism explored seriously for the first time. The outcome of these issues will have a strong impact on carbon prices which will, in turn, affect wholesale electricity prices and the viability of different assets throughout Europe.

AFRY has its own in-house carbon model, Æther, and a dedicated carbon team focusing on how the EU ETS is changing and modelling carbon price projections.

AFRY’s EU ETS Carbon Market Report:

  • Presents our annual projections for EU ETS carbon prices out to 2060 for our three internally consistent scenarios (High, Central and Low). These scenarios incorporate different decarbonisation trajectories for the EU ETS that are consistent with AFRY’s whole-economy decarbonisation targets.

  • Considers the main drivers of carbon prices in each scenario, including:

    • legislative developments in the EU ETS;

    • the evolution of generation capacity mix;

    • interaction of other commodity prices;

    • and developments in technology costs.

  • Delivers in-depth market intelligence, including insights into

    • policy and regulation;

    • the EU Emissions Trading Scheme.

  • Based on highly detailed modelling from our suite of worldwide commodity models.

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Mostyn Brown - Manager, AFRY Management Consulting

Mostyn Brown

Manager, AFRY Management Consulting

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Daniella Sauven - Senior Consultant, AFRY Management Consulting

Daniella Sauven

Senior Consultant, AFRY Management Consulting

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