EU carbon price boost from 2007 emissions data

LONDON (Reuters) - Emissions of carbon dioxide rose slightly last year among businesses participating in the European Union's emissions trading scheme (ETS), analysts said on Thursday, contrary to an expected drop.

The EU executive Commission published on Wednesday preliminary 2007 data reflecting about 94 percent of actual emissions.

Emissions rose about 1 percent, analysts said. Some had predicted a fall as a result of an economic slowdown in the fourth quarter and cheaper, low carbon-emitting natural gas.

The emissions increase prompted Fortis analyst Kris Voorspools to raise his carbon price forecast, he told Reuters on Thursday.

"I am upgrading it a little bit."

Deutsche analyst Mark Lewis on Thursday forecast a carbon price of 35 euros in 2008. European Union allowances (EUAs) were trading up 1 percent at 23.7 euros on Thursday morning.

EU ETS emissions in 2007 rose around 1 percent to some 2,160 million tons of carbon dioxide, Lewis said, and in 2008 new installations would add a further 84 million tons.

That would imply 2,244 million tons emissions in 2008, not allowing for any external influences including an economic slowdown, compared to a quota of emissions permits in 2008 of 2,083 million tons, Lewis said.

"It's a very very meaningful constraint," he added.