Market in Carbon emissions is victim of allowances theft

After the VAT fraud in 2008 valued at approximately EUR 5 billion by Europol in 2009, the CO2 market has been again a victim of fraud.

Brussels have just revealed new updates on Cyberattacks, conducted against the files in which are recorded the CO2 quotas for Austria, Greece, Czech Republic, Poland and Estonia. Hackers have succeeded in forcing the safety records and steal the rights they have "immediately sold", said recently the European Commission.

National registries of carbone emission manage the record of EU Allowances (EUAs) set by the European Union. One should remember that each EU member is allocated an annual quota of pollution rights which are then redistributed for free to companies that can purchase additional EUAs, in case of need, to those that, in contrast, have used less than expected.

Brussels says the records of fourteen European states would exhibit IT security problems. Therefore, a suspension of trading was orderly as of 19 January to halt the sale of allowances (EUAs) with fraudulent origin but also to take time to strengthen security processes for computer systems.

Last Friday, the European commission has allowed partial reopening of the market for five out of thirty five countries concerned. France, whose record of CO2 allowances is managed by the Caisse des dépôts et consignations (CDC), is part of the lucky ones, as well as Germany, the Netherlands, Slovakia and the United Kingdom

However, doubts remain about the reliability of the system. Moreover, these gaps undermine the credibility of this market at a delicate time: Starting in 2013, the CO2 allowances will not be anymore allocated for free as it is the case now. This latest incident calls for the establishment of a single registry managed from Brussels!