WRAP UP

Tamar Hallerman
GHG Monitor
7/3/13

ON THE INTERNATIONAL FRONT

The European Parliament narrowly passed a measure this week aimed at providing a lifeline to the European Union’s long-ailing Emissions Trading System. EU lawmakers voted 344-311 July 3 in favor of a “backloading” scheme that would temporarily remove up to 900 million carbon allowances from the EU’s cap-and-trade scheme next year and reintroduce them into the market in 2015, a weakened version of a plan rejected by lawmakers earlier this spring. The measure is aimed at limiting the market’s chronic oversupply of carbon permits in the hopes that it could prop up allowance prices. The vote was a major victory for supporters of the ETS, which has seen prices drop significantly since the 2008 financial crisis from nearly €30 per tonne to just over €3 earlier this year. Analysts argue that prices will need to be upwards of €40 to spur significant clean energy investment. Carbon prices rose nearly 10 percent following the vote to €4.33 ($5.61) each. The plan must now be approved by EU’s 28 member states, some of which are bitterly opposed to intervening in the market and raising energy prices.