ICF International Warns European Carbon Prices Could Exceed EUR 70 and Wholesale Power Prices Could Double by 2020


In its recently released European Power and Carbon Outlook 2009-2030 (European Outlook), ICF International (NASDAQ:ICFI), a global leader in energy and environmental analysis, projects a sevenfold increase in the price of carbon dioxide (CO2) allowances by 2020, as compared to February 2009 levels, if the European Union (EU: 21.68, 0, 0%) is to meet its goal of reducing emissions by 30 percent between 1990 and 2020.

FUENTE – FoxBusiness – 02/04/09

European Outlook examines the interrelated dynamics of the European power and carbon markets in light of the EU energy and climate legislative package voted in December 2008 and the current economic crisis. It is designed to help utilities, industrials, financial institutions, and other market participants make strategic operational and investment decisions based on long-term carbon and power market views. The study provides a comprehensive, integrated view of EU carbon prices, emissions, and sources of abatement. It also captures wholesale electricity prices, build mix, future capacity, and generation by region, between 2009 and 2030.

Reaching the ambitious target of procuring 20 percent of the EU’s energy from renewable sources by 2020 will require investment in higher cost renewable energy, as well as investment in supporting energy infrastructure in order to move the energy to market. ICF’s analysis shows that if the renewables target is missed, a portion of the costs of meeting CO2 targets will shift from renewable subsidies to electricity prices. Indeed, meeting 2020 targets will require substantial investments in gas-fired capacity, and later in carbon capture and storage. The cost of these investments, once factored into electricity prices, will cause them to double between 2010 and 2020.

“Participants in the EU ETS carry significant future exposure to whether or not renewable targets are met,” commented Neil Cornelius, head of ICF’s European energy markets. “In the case of the power sector, there is a very material impact on the viability of non-renewable investments and assets, so this goes to the heart of portfolio decisions.”

“EU ETS participants should look beyond the current economic and credit crisis and adopt a long-term carbon market strategy that anticipates a sharp rise in demand for emission reductions over the next five years,” adds Diane Simiu, carbon analyst. “Anyone going for the ‘dash-for-cash’ approach is in for a rude awakening when the carbon market picks up.”

Further information on ICF’s European Power and Carbon Outlook 2009-2030 is now available at http://www.icfi.com/europeanpower.

About ICF International

ICF International (NASDAQ:ICFI) partners with government and commercial clients to deliver professional services and technology solutions in the energy and climate change; environment and infrastructure; health, human services, and social programs; and homeland security and defense markets. The firm combines passion for its work with industry expertise and innovative analytics to produce compelling results throughout the entire program life cycle, from research and analysis through implementation and improvement. Since 1969, ICF has been serving government at all levels, major corporations, and multilateral institutions. More than 3,500 employees serve these clients worldwide. ICF’s Web site is http://www.icfi.com.

Caution Concerning Forward-looking Statements

This document may contain “forward-looking statements” as that term is defined in the Private Securities Litigation Reform Act of 1995–that is, statements related to future–not past–events, plans, and prospects. These statements involve known and unknown risks, uncertainties, and other factors that may cause our actual results, levels of activity, performance, or achievements to be materially different from any future results, levels of activity, performance, or achievements expressed or implied by such forward-looking statements. In some cases, you can identify these statements by forward-looking words such as “guidance,” “anticipate,” “believe,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “potential,” “seek,” “should,” “will,” “would,” or similar words. You should read statements that contain these words carefully because they discuss our future expectations, contain projections of our future results of operations or of our financial position, or state other forward-looking information, and are subject to factors that could cause actual results to differ materially from those anticipated. These statements include those that refer to ICF’s current expectations about the acquisition of Macro. Although ICF believes its expectations are based on what management believes to be reasonable assumptions, it cannot assure the expectations reflected in this document will be achieved as they are subject to risks and uncertainties that are difficult to predict and may be outside of ICF’s control. Such risks and uncertainties include the possibility that the benefits anticipated from the Macro transaction will not be fully realized and other risks in connection with the proposed transaction.

In relation to ICF’s business, particular uncertainties that could adversely or positively affect the Company’s future results include but are not limited to: risks related to the government contracting industry, including the timely approval of government budgets, changes in client spending priorities, and the results of government audits and investigations; risks related to our business, including our dependence on contracts with U.S. federal government agencies and departments and the State of Louisiana; continued good relations with these and other customers; success in competitive bidding on recompete and new contracts; performance by ICF and its subcontractors under our contract with the State of Louisiana, Office of Community Development, including but not limited to the risks of failure to achieve certain levels of program activities, termination, or material modification of the contract, and political uncertainties relating to The Road Home program; uncertainties as to whether revenues corresponding to the Company’s contract backlog will actually be received; the future of the energy and air transportation sectors of the global economy; our ability to attract and retain management and staff; strategic actions, including attempts to expand our service offerings and client base, the ability to make acquisitions, and the performance and future integration of acquired businesses; risks associated with operations outside the United States, including but not limited to international, regional, and national economic conditions, including the effects of terrorist activities, war, and currency fluctuations; and other risks and uncertainties disclosed in the Company’s filings with the Securities and Exchange Commission. These uncertainties may cause ICF’s actual future results to be materially different than those expressed in the Company’s forward-looking statements. ICF does not undertake to update its forward-looking statements.




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