Ahead of the European Commission’s publication of preliminary emissions data  for 2024, analysts predict a modest decline compared to the previous year. In 2023, emissions declined by a massive 15,5% driven mainly by the reductions recorded in the power generation sectors.

According to an analysis published by Veyt last week, emissions from stationary installations are estimated at 1043,8 Mt, a 4,8% decline from 2023 levels. In another report published earlier in January, Veyt predicted a “significant cut in power emissions (from 505 to 439 Mt), flat industry emissions (591 Mt), and an increase in aviation emissions (from 53 Mt to 58 Mt). ”

Analysts polled by Carbon Pulse seem to agree with Vyet predictions. “Verified emissions covered by the EU ETS continued their downward trend in 2024 with total output seen 5-8% lower year-on-year,” writes Carbon Pulse this morning.

Last week, the European Commission announced that it will release the 2024 emissions data for EU ETS-covered sectors on April 4. While it seems that all analysts agree that emissions will decline, a decrease larger or smaller than initial estimates could impact the price of allowances and temporarily affect the strong correlation that has existed for some time between EUAs and gas prices.

“However, it may take more time for fundamental EUA demand to reassert itself to the point that carbon prices disconnect from gyrations in the natural gas market and revert to their own drivers,” writes carbon analyst  Allesandro Vitelli.