The current Minister for Trade and Industry, Martin Riman, proposes an 7% y/y increase in annual CO2 allowances for the Czech Republic for the 2008-2010 period to 104m t from 97m t.
Our view: While the minister argues with the GDP growth, higher energy consumption, we believe that the CO2 allowance limits for individual countries may be reduced following report surpluses in 2005 – that includes also the Czech Republic.