The European Commission proposed yesterday (14 November) to delay the auctioning of 900 million carbon credits in the next phase of the EU's emissions trading scheme (ETS). The goal is to raise the flagging price of carbon in the market. The credits would be held back from auctioning in the 2013-15 period, and put back into the system in 2019-20.
The figure is the middle option of the three choices outlined by the Commission in July. The Commission intends to adopt the change through a working group, but the European Parliament and member states must first adopt a proposal put forward in July to change the ETS directive to give the Commission the authority to do so.
The proposal was issued along with an impact assessment of the measure's effects. Most member states have been waiting to see this impact assessment before deciding whether to support the proposal, with the exception of Poland which had already come out against it. A strategy document outlining six possibilities for long-term fixes to the ETS, previewed in last week's edition of European Voice, was also published.
Not far enough
Renewable-energy companies and green campaigners welcomed the step but said it needed to go further. “Back-loading only 900 million allowances is not enough to re-establish an effective carbon market in Europe,” said Rémi Gruet of the European Wind Energy Association (EWEA). Dutch Green MEP Bas Eickhout said the Commission was behind the game in fixing the ETS and should be doing more than just outlining future options.
Industry association BusinessEurope condemned the backloading proposal, as did steel industry association Eurofer. “Artificially increasing the carbon price by withholding or removing allowances from the emissions-trading system will undermine the competitiveness of European industries and increase the energy bill for consumers even more,” said Eurofer director-general Gordon Moffat.