London, 31 March 2010

Societe Generale now anticipate emissions will decrease by 8.6% or 183 Mt, to 1,937 Mt for 2009. This revision represents an additional 47 Mt reduction in our estimates compared to December 2009 (1,984 Mt) and is based on the latest Eurostat figures for 2009. 2008 EU ETS emissions stood at 2,120 Mt (Norway included).

The recovery end 2009 was slightly slower than expected. EU industrial production fell an average 13.4% compared to 2008 and a cumulative 3.9% from January to December 2009. Construction activity decreased by 7.7% as compared to 2008 and a cumulative 5.4% over 2009. Electricity generation in Europe has decreased by 5.0 % and oil and gas production was down 6.4% in 2009 over 2008.

In addition, generation from non-carbon emitting units increased their share by more than 2 percentage points in the energy mix in 2009, from 47.1% to 49.4%.

Emissions should re-increase by 4.5%, or 87 Mt in 2010. These revised emission volumes have significant implications for EU ETS compliance demand. There should be a 192 Mt EUA surplus in 2009. From 2008 to 2012 we estimate the cumulated EUA surplus at 23 Mt and the cumulated EUA, CER and ERU surplus at 405 Mt, according to Societe Generale's Emmanuel Fages.

Ends --