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EU carbon "backloading" decision at odds with evidence of low carbon economy

Date
16 April 2013
EU carbon "backloading" decision at odds with evidence of low carbon economy

LONDON: Today the European Parliament voted to reject plans to delay the auctioning of carbon allowances in the EU Emissions Trading System, a move The Climate Group CEO Mark Kenber calls a 'missed opportunity' which is at odds with the evidence of a low carbon economy.

MEPs votes were a narrow 334 to 315 against the “backloading” proposals from the European Commission, which were designed to boost the carbon price as well as to underpin and strengthen confidence in clean technology investment. As a result the carbon price has fallen from €4.3 per ton of CO2 to €1.70.

In an EU press release, Connie Hedegaard, European Commissioner for Climate Action said: ''The Commission of course regrets that the European Parliament has not approved the back-loading proposal. However, it is worth noting than when it was suggested in the second vote that the Parliament finalised its rejection right away, this was not supported. The proposal will now go back to the Parliament's Environment Committee for further consideration.

"Europe needs a robust carbon market to meet our climate targets and spur innovation. The Commission remains convinced that back-loading would help restore confidence in the EU ETS in the short term until we decide on more structural measures. We will now reflect on the next steps to ensure that Europe has strong EU ETS. In doing so the Council's position on the proposal will be an important factor and I take note of the Irish Presidency's reaction today to urgently pursue and conclude discussions among Member States. The market, the investors and our international partners are all awaiting.''

Mark Kenber, CEO, The Climate Group commented: “EU parliamentarians have missed an opportunity to reaffirm their climate leadership and strengthen the signal that low carbon business represents the future of the region’s economy.

“A robust carbon price is a key part of any comprehensive framework for reducing emissions cost effectively and avoiding the worst impacts of climate change.

“Today’s decision is clearly at odds with the evidence that investment in clean energy, technology and sustainable business practices produces superior returns and is the cornerstone of a prosperous European economy.”

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