What are CO2 certificates?
Against the background of climate change, it is not surprising that politicians around the world are calling for carbon dioxide savings. Although private households also play a role, it is primarily large companies, primarily a wide variety of industrial sectors, that are responsible for the majority of CO2 pollution. For this reason, emissions trading was introduced as early as 2005 as part of the Kyoto Protocol: Since then, companies have had to purchase emission rights in order to be allowed to emit carbon dioxide into the atmosphere at all. These emission rights are also EUAs (European Union Allowance) or EEAs (European Emission Allowances) called.
Danger: Both the production entitlement of the company and the securities that you as an investor can trade are identified with the term “CO2 certificate” titled.
On the one hand, a CO2 certificate entitles you to produce one tonne of CO2 in a certain period of time. From an economic point of view, lower CO2 production is therefore more advantageous for companies. Since there was an oversupply of certificates in the first few years, investment in CO2 reduction (e.g. by replacing certain technologies) was still limited. On the other hand, CO2 certificates are securities that track the price development of such emission rights. You can trade these off-exchange with an issuer and thus speculate on rising prices.