Before revision:  This new price development has received a lot of attention in political discussions in which it has been attributed to the recent reformof the EU ETS -- the strengthening of the Market Stability Reserve through cancellation. It is, however, challenging to find empirical evidence which can link the two, or more generally, to provide evidence about the true cause of the upward trend. In this paper , we obtain first empirical results pointing in the direction of a period of exuberance in EUA prices .
After revision:  This new price development has received a lot of attention in political discussions in which it has been attributed to the recent reformof the EU ETS -- the strengthening of the Market Stability Reserve (MSR) and speculative buying as main price drivers. The former suggests an increasing role of fundamentals, while the latter could give rise to investor overreaction and mispricing. Analyzing the price run up using the anticipative dating algorithm by Phillips et al. (2015) , we obtain first empirical results pointing in the direction of a period of exuberance in EUA prices .