Brussels, 23/01/2013 (Agence Europe) - The record fall in carbon prices to below €5 per tonne on the European carbon market, which is governed by the ETS Directive, requires decisive action in the short term to prevent market collapse and also in the long term, according to the Greens/EFA Group at the European Parliament (EP). The group called on Tuesday 22 January 2013 for approval of the proposal for the immediate reform of the ETS. With trialogue discussions continuing on the European Commission's proposal to temporarily withdraw or “backload” from the market some 900 million tonnes of carbon dioxide quotas at the start of the third ETS trading period (see EUROPE 10768), Dutch MEP Bas Eickhout, Greens/EFA spokesman on the climate, said the shortcomings of ETS had to be addressed in a proper and sustainable manner by permanently withdrawing excess quotas. He called on the EU and Council of Ministers to approve the Commission's short-term reform plans, which he sees as falling far short of the mark but necessary nonetheless
His appeal was made ahead of a vote at the energy and industry committee at the EP, which will be issuing its opinion on Tuesday 24 January, and a vote at the environment committee on 19 February.
“The EU's flagship climate change policy is at risk of total collapse. Despite more than a year of dramatic warnings about the sinking carbon price in the emissions trading scheme, prevarication by EU policy makers has pushed the ETS to the brink. This latest warning should redouble the resolve of decision-makers in the European Parliament and Council, who are set to endorse the modest proposal from the European Commission on postponing the auctioning of 900 million emissions allowances. While approving and implementing the Commission's 'backloading' proposal must now be a top priority, the reality is that more robust and permanent solutions are needed to properly save the emissions trading scheme. We urgently need more durable structural solutions, notably on permanently retiring emissions allowances to address the oversupply, and not simply postponing the auctioning of permits”, Eickhout argued.
The Greens/EFA say that, in addition to the backloading of 1.4 billion tonnes-worth of quotas, a mechanism must be introduced to cut emissions by 2.5% a year in order to achieve the EU's emissions target of at least a 30% cut in emissions by 2020. “Failure to deliver a permanent solution will mean the emissions trading scheme will continue to fail in its purpose of delivering domestic emissions reductions and stimulating investment in green technologies to this end”, claimed Eickhout. (AN/transl.fl)