PRIMA pioneers risk management in transport decarbonisation
LONDON, Sept. 22, 2020 /PRNewswire/ -- PRIMA's pricing service has been chosen to launch the world's first risk management contract for the recycled feedstocks cutting transport's carbon emissions.
The CME-listed futures contract settles against the daily PRIMA European T1 Used Cooking Oil price assessment published by London-based PRIMA. This provides the first instrument for European biodiesel and HVO producers, oil refiners and feedstock suppliers to manage their forward pricing risk using a low carbon feedstock.
Recycled biogenic oils such as used cooking oil have seen surging demand from biofuel producers and oil refiners in Europe and the US in recent years. Diesel substitutes made from used cooking oil offer carbon savings of 90% and more relative to fossil diesel, and are an immediate route to decarbonisation and ESG targets. In recent years PRIMA services have helped the market grow at rates of between 20-40% per year. The industry now represents in excess of $3bn/yr in business in Europe alone.
By 2030 EU member states will source at least 14% of their transport fuel from renewables. But many European countries are planning much higher carbon cutting renewables content. Investors are paying heed to stimulate the supply side solutions the transport sector will need to provide mobility services at minimal environmental cost.
PRIMA's daily assessment tracks liquidity in European and imported waste oils used in biofuels manufacture. Waste oils are only considered towards the assessment if they are accompanied by the stringent sustainability documentation required by European regulators.
"The new contract is a world first in transport fuels: it allows the existing global transport fuel supply chain to manage risk while eliminating emissions. PRIMA is proud to be producing the data tools which are speeding the energy transition," says PRIMA Managing Director Matthew Stone.
PRIMA has been at the forefront of the oil industry's efforts to decarbonise since the firm's suite of prices, analytics and consulting services on the international market for low carbon fuels and feedstocks was launched in 2014. PRIMA's client base has grown exponentially alongside to include low carbon fuel and feedstock producers, energy firms, government legislators and investors in low carbon solutions from across the globe.
For more information on PRIMA's services in market and fundamentals data provision, industry analysis and tailored information services, contact Fiona.ribbins@prima-markets.com.
Share this article