Hedging Emissions Trading System Market Risks: Internal Volatility Modelling and Explainable Carbon Option Pricing

EPSRC · United Kingdom government procurement

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March 30, 2028
Response Due
Active
Status

Opportunity Overview

"To tackle these research questions, this study intends to employ an interdisciplinary approach, combining techniques from engineering mathematics, environmental economics, and financial engineering, aiming to fulfil the following research objectives:
- Establish an internal volatility prediction model for the carbon market that incorporates news impact, using deep learning techniques.
- Develop an explicit carbon option pricing method based on internal volatility using numerical simulation.
- Design carbon option hedging strategies adaptable to different market expectations.
- Explain the principles of pricing and hedging using model explanation tools and interactive interpretation methods."

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Solicitation Details

Issuing agencyEPSRC
CountryUnited Kingdom
CategoryResearch Development
PublishedSeptember 30, 2024
Procurement stageActive solicitation
Response dueMarch 30, 2028
StatusOpen — accepting responses
Official sourceView original notice
Last verifiedOctober 06, 2026

Source: UK Research and Innovation (UKRI) — Open Government Licence v3.0.

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