Wednesday, April 22, 2015

European carbon market reform set for 2019

European parliament vote to strengthen emissions trading scheme by taking 1.6bn surplus credits off the market to boost carbon prices, but critics call for steps to be taken earlier. Reforms to strengthen the EU’s flagship policy for cutting carbon, the emissions trading scheme (ETS), will start at the end of 2018. The carbon market is supposed to drive Europe’s transition to cleaner sources of energy, but a cocktail of recession, free allocations to polluters and over-achievement on green energy targets have created a flood of 2bn allowances. That has led to a carbon price of around €7 (£5) per tonne, too low to encourage power companies to switch from polluting fuels such as as coal. A new report by analysts Reuters Thomson Point Carbon estimates that by 2020, the reforms could nudge carbon prices up to €20 per tonne. Read more at http://www.theguardian.com