The €40 EUA price is based on Deutsche Bank’s long term gas and coal price estimates, and is the price “required to fulfil the policy objective of making CCS the new-entrant technology of choice for power generators by 2020,” according to the bank.
Whether or not CCS becomes the new entrant of choice by 2020 will depend to a large extent on future gas prices.
“Based on our revised forecast for long-term oil, gas and coal prices, our base-case scenario for the residual ETS abatement required
- Credit risk quants are hitting the tech gap
- Princeton tops inaugural Risk.net quant master’s ranking
- Does credit risk need an expected shortfall-style revamp?
- Teach history to avoid mistakes of yesterday’s quants