Moody’s Talks – Infrastructure Finance
August 17th 2018 (6.20 mins)
In the first episode of our new podcast series Moody's Talks - Infrastructure Finance, Paul Marty, Team Leader for European utilities in the Project and Infrastructure Finance Group, and Graham Taylor, a Moody’s utility analyst based in London, discuss a significant shift now taking place in the carbon market in Europe. Under the European Union’s Emissions Trading Scheme, the low price of carbon allowances has meant that the scheme has been ineffective in driving switching from coal-fired power generation to lower-carbon generation. However, the price of carbon allowances has recently recovered to over €17/tonne in anticipation of market tightening as a result of the scheme’s reform post 2020. Paul and Graham discuss the impact of the recent reforms, the outlook for carbon prices and why higher carbon prices support electricity prices and the profits of most generators.