Carbon Price Forecasting

Accurately forecasting the future economic costs of emissions is also very important both for companies and government agencies. This is important, for the following main reasons:

1. having an accurate forecast over months and years into the future of the economic cost of emissions.

2. having an accurate forecast, for trading tomorrow or over the next ten days, of how the traded carbon price is predicted to move, thus allowing buyers to optimise timing to reduce their VWAP and sellers to optimise timing to maximise their VWAP.

3. helping covered entities plan their purchase, or sales, of carbon credits against their forecast emissions.

4. helping importers who face (as now in the EU) a Carbon Border Adjustment Tax, where the tax rate tracks the EU ETS price, to better forecast their import tax bill (and purchase of certificates)