This paper investigates the transactions in CO2-emission derivatives made by Italian counterparties. The analysis is based on the EMIR database, which collects daily observations of transactions in derivatives.
Between 2021 and 2023, the use of derivatives on CO2-emission allowances by Italian counterparties increased rapidly in terms of notional amounts. The number of non-financial companies trading these derivatives, mainly futures, rose as well. A very small number of Italian banks are counterparties to these contracts, representing only a minimal fraction of the overall gross notional amount of their derivatives portfolio.
