Prices in the world’s biggest carbon market are soaring

become cheerier about the pace of vaccinations and the chances of a speedy economic recovery, the prices of stocks, commodities and all sorts of assets are rising. So too are carbon prices in Europe, home to the world’s largest emissions-trading system. Prices have surged by 60% since November; on February 12th they hit a record high of nearly €40 ($49) per tonne of carbon-dioxide equivalent (see chart).Last year the value of global carbon markets hit a record €229bn, a five-fold increase from 2017. The ’s emissions-trading system () accounts for nearly nine-tenths of both that value and that growth (China’s is just starting up; see ). In 2020 around €1bn-worth of emissions allowances changed hands a day, as well as lots of options and futures contracts. There are now clear signs that the market is joining the financial mainstream, with hundreds of investment firms trading in it.