EUA Market Update: 2025 Volatility and What to Expect in 2026

The EUA market has shown notable volatility throughout 2025. Spot prices have oscillated sharply across the year, with a notable dip in April followed by a strong rally from September onward. Despite these swings, the market has consistently returned to the low-€80s range, with key highs recorded at:

• 30 January: €82.25

• 31 January: €82.21

• 4 November: €82.10

This pattern reflects a market balancing short-term sentiment shifts against deeper structural forces. As we approach 2026, those structural drivers become increasingly important.

Chart Source: Bloomberg, EUA Spot Data

2026 Outlook: Analysts Expect Higher EUA Prices

Forward expectations point toward continued price appreciation next year. In a July 2025 Reuters poll of 10 analysts, the average 2026 price forecast landed at €91/EUA, while several traders projected more bullish outcomes - potentially up to €110/EUA.

The direction of travel is clear: tighter supply and broadening demand are likely to keep upward pressure on prices.

Key Policy and Market Drivers for 2026

REPowerEU and Supply Front-Loading

REPowerEU, introduced in the wake of the war in Ukraine, continues to reshape EUA supply dynamics by accelerating the energy transition and advancing EUA auctions originally planned for 2027–2030.

• 2026 auctions under REPowerEU are expected to total ~93.3 million allowances, an increase of roughly 60% compared with 2025.

• This front-loaded supply may create mild price softness early in the year.

• However, the programme ends in August 2026, after which supply is expected to drop sharply.

• The resulting contraction could set the stage for a renewed price rally in the second half of 2026.

Growing Cross-Sector Demand

Demand continues to expand beyond traditional stationary installations:

• Aviation

• Shipping

• Other sectors now integrated into the ETS

Analysts broadly expect this expanding coverage to reinforce an upward trajectory. Quarterly price expectations currently sit around €80 (Q1), €82 (Q2), and €84 (Q3).

2026 Outlook

The EUA market in 2025 has been defined by noticeable intra-year swings, but the broader story is one of structural tightening, policy-driven supply shifts, and expanding sectoral demand.

As REPowerEU front-loads supply before sharply easing back, and as more sectors enter the system, 2026 is shaping up as a year where price support and potentially significant gains look increasingly likely.

Stay ahead of EUA price shifts. Contact Grey Epoch today to plan your strategy for 2026.