European parliament to reform struggling co2 trade

european parliament to reform struggling co2 trade

This is to drive up the price and thus make the emission of CO2 (carbon dioxide), which is harmful to the climate, more expensive. The reform still needs the yes of the EU member states.

The industry in the EU must submit rights for the emission of CO2, the companies can trade with each other with it. Due to the low price of currently four euros per ton of carbon dioxide, there is a lack of incentives for climate-friendly investments. The EU commission had once set a target of 30 euros – but the economic downturn of recent years, among other things, has put pressure on demand and price.

That’s why the parliament now wants to allow the eu commission to withhold 900 million CO2 certificates (so-called "backloading"). By way of comparison, the eu commission will put a total of 3.5 billion of these certificates on the market between 2013 and 2015. Temporarily withheld CO2 rights to be released before the end of the decade. The initiator of the reform proposal, climate commissioner connie hedegaard, was relieved.

With its vote, the EU parliament made clear how important it is to invest in low-CO2 technologies, she said.

SPD member of the european parliament matthias groote, who negotiated the compromise between the parliamentary groups, was satisfied after the vote: "the european parliament has saved european emissions trading from extinction," he said. He appealed to the federal government to push for reform. Germany has not yet taken a clear position because the economics and environment ministries are at cross-purposes on the issue.

The reaction from the federal cabinet in berlin was correspondingly contradictory. Strabburger’s yes to backloading is regrettable, the economics ministry said. Environment minister peter altmaier (CDU), on the other hand, was positive. With a view to the upcoming negotiations between the european parliament and the EU states, he said there was now "a good basis for a viable solution".

The industrialist wing of the european parliament, on the other hand, was critical of the "turncoat decision," as herbert reul of the CDU called it. Europe is "making a fool of itself. The decided intervention would only minimally increase the price of CO2 pollution rights by about one euro and was therefore "completely senseless". Reul rejects the intervention because it undermines industry’s confidence in the CO2 market. Similar comments were made by FDP member holger krahmer.

The federation of german industries (BDI) took the same line. Backloading was unsettling industry throughout europe, the EU states had to correct the decision, the BDI demanded. The german chamber of industry and commerce (DIHK) warned that higher CO2 prices could deter companies from making investments. Backloading is "the wrong signal in times of massive weakness of the european economy".

The response among environmentalists, on the other hand, was quite different. Greenpeace buried the vote. Christoph bals, political director of the environmental organization germanwatch, spoke of a good day for climate protection, but at the same time insisted on stronger intervention. "As long as the 900 million certificates cannot be completely withdrawn from the market before 2020, backloading will remain nothing but hot air," said bals.

Contrary to expectations, the reform failed for the time being in the european parliament in april, but now it has passed the strasbourg plenum after all. The current project is only a first step in the reform of emissions trading. By the end of the year, eu climate commissioner hedegaard wants to make further, long-term proposals. Environmental organizations hope for a permanent shortage of CO2 certificates.

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