BoI new emission trading product

Bank of Ireland has launched a new product to allow Irish companies trade off energy emissions.

Under the Kyoto Protocol, Ireland has agreed to reduce carbon dioxide by limiting harmful energy emissions.

Through the EU Emissions Trading Scheme (EUETS) the Bank of Ireland Global Markets Energy & Emissions Desk will provide transaction and hedging services to Irish companies to trade off emissions. It will allow companies that produce more carbon dioxide to buy increase limits from those that produce less.

Bank of Ireland Global Markets chief executive Mick Sweeney says there has been a boom in emissions trading since the official EUETS launch in January.

“With this trading, price volatility is also rising and since the launch of the scheme, prices have increased from €6 to around €17 per allowance. This is likely to rise further as companies seek to cover any allowance shortfall ahead of the April 2006 surrender deadline. With penalties of €40 for every tonne of carbon dioxide produced over a company’s allocation it would be prudent management for companies to hedge against emissions trading price risk.”