The above-mentioned ambiguities relating to the concrete timelines for monetisation seem also to be the basis for anxiety of the IETA organisation which in the ‘IETA Response Early Auction Consultation’ of 7 February 2011 remarked:

“The European Investment Bank (EIB) does not seem to envisage starting the monetisation of the NER300 ahead of the registry commissioning through sales of futures...”


“When will the the Union registry be ready? This will determine the possible start dates for both the NER300 monetisation and auctions.”


To conclude this thread: the specification by the EIB of main elements of the monetisation method including, particularly, the defined monetisation period and the expected total volume of monetisation is impatiently awaited.


By the said moment EUETS participants wanting to inquire for particulars relating to the way, the monetisation-EUAs will enter into the market, have to be satisfied with few guidelines prescribed in the above-cited Cooperation Agreement. Pursuant to the said Agreement:


1. The EIB shall monetise the allowances for settlement in December 2013 at the earliest. The EIB shall not require payment from its counterparties except on delivery of the allowances.


2. The EIB shall perform the monetisation of allowances with the objective of minimising any impact on the market for EU emission allowances. The EIB will determine a monetisation method which shall include the timing and scheduling of monetisation as well as the distribution of the volumes over the monetisation period and over the means of monetisation (exchanges or other). The monetisation method shall respect the following principles:

(a) Monetisation of at least 200 million allowances shall be concluded no later than 10 months after the allowances have been transferred to the EIB and made available for the settlement of transactions:

(b) Monetisation shall take place periodically at least every second week. Monetisation volumes should be spread as evenly as possible over the monetisation period. Volumes and timing of monetisation may be adjusted to minimise any impact on the secondary market;

(c) The EIB shall ensure that the monetisation prices do not deviate significantly from the relevant secondary market prices over the monetisation period;

(d) Reports setting out at least the overall volume and aggregated prices of the monetisation shall be published on the website of the EIB on a monthly basis, within two weeks of the end of each month over the monetisation period;

(e) Monetisation shall be effected in accordance with applicable laws in respect of money-laundering, terrorist financing and market abuse and accordingly counterparties acting on the EIB's behalf shall be required to demonstrate their compliance with such laws.


3. The main elements of the monetisation method including the defined monetisation period and the expected total volume of monetisation shall be published on the EIB's website as soon as possible and prior to the start of the monetisation; any significant adjustment shall to the extent practicable be announced at least one month in advance as well.

4. With a view to minimising execution risk, the EIB shall apply a selection process which aims at ensuring the selection of a professional counterparty or counterparties with a rating acceptable to the EIB in its ordinary business. Moreover, the EIB shall, to the extent required by its normal guidelines and operating procedures, require counterparties to post collateral as a guarantee of execution.

The provisions of the Article 12 of the Cooperation Agreement are quoted above nearly verbatim in order to enable the readers to collect the precise information as regards the rules governing monetisation at this stage of procedures.


Editorial note: An update of the information on the issue concerned can be found in “The schedule and key parameters for the monetisation of CO2 allowances from NER 300 reserve specified by the EIB”.