A remedy for scant supply on the domestic carbon market is underway.

According to the latest report from broker OMF Financial, carbon prices are holding firm at $18-$18.45 a unit but “sellers continue to be few and far between – most are hanging out for higher prices.”

“Whilst demand is outpacing supply at this present point in time – there are a couple of lines of supply coming that should well and truly satiate demand.”

Industry allocations

Shares in NZX Limited have taken a hit on the company’s own exchange today after it slashed $19.9 million from the expected sale proceeds of its carbon trading business.

At 3pm NZX shares were down 13c at $2.05, a fall of 6%, on mild volume.

Late on Friday, after the market closed, NZX announced it would write down the carrying value of remaining sale proceeds of its TZ1 Registry, which it sold to UK firm Markit Group last year.

Sharemarket operator NZX is signalling a $19.9 million hit to its balance sheet from a carbon trading business it has sold, blaming a lower priority given to carbon trading and "lack of a global political agenda around carbon."

The reduction is to the valuation on its balance sheet for a prospective 2012 performance payment from the sale of its TZ1 Registry business last year. It will appear as a reduction in the gain on disposition of assets.

The recession and uncertainty over the ETS will delay New Zealand companies actively trading on carbon markets.

Levels of trading are likely to be low, with businesses taking a fairly conservative approach, according to Business New Zealand manager for energy, environment and infrastructure John Carnegie.

Attempting to explain Treasury's projected costs of amending the ETS, which differed from initial Ministry of the Environment advice, an experienced spokesman emailed NBR on Friday.

Outlining the reasons for varying figures (based on whether or not the price of carbon per tonne will increase to 2050), the spokesman said:

“It is common for such work by different people to differ because of different assumptions and when the assumptions differ as much as they do between these examples, then the results will also differ to a similar extent.”