A Brussels-based trade body has told the European Commission that a crucial scheme meant to keep a check on emissions should push back the number of carbon permits put out for auction.
The EU is debating whether to “backload” the number of carbon allowances available in the EU Emissions Trading Scheme to try and prop up the flagging carbon price.
Earlier this week the UK’s Energy Secretary Ed Davey said he was pushing for some emissions allowances to be cancelled permanently to give businesses and markets more “certainty”.
The International Emissions Trading Association which represents firms from the oil, gas and energy brokering sectors, has thrown its voice into the mix as well, urging for allowances from early year auctions to be pushed back by a few years to “phase 3” of the scheme.
Dirk Forrister, the IETA’s President and CEO said: “The EU ETS is a role model for many countries contemplating carbon pricing through emissions trading systems.
“IETA wants a system that will continue to be the preferred template for carbon markets world-wide as it successfully reduces emissions at least costs. IETA contributes its own assessment of reform options to this important debate, in hopes that policy makers will consider backloading in concert with other reforms.”
The group also wrote to EU Climate Commissioner Connie Hedegaard last week, warning the “unexpectedly deep and long recession” has meant the oversupply of carbon permits has encouraged some Member States to fall back on developing pro-low carbon investment policies.