Hot air scammers want a bigger guaranteed market for their shonky product. Go figure.
The European Union needs to aim for a deeper emissions cut soon, to rescue a record low carbon price and spur long-term investment in low-carbon technology, leading carbon market players said at an industry gathering.
Europe’s economic slump has made it easier for the EU to reach its 2020 climate goal, and a tougher target to cut emissions would restore relevance in the EU emissions trading scheme by lifting carbon prices from record lows, they said.
Europe’s stagnant growth has caused a massive surplus of so-called EU Allowances (EUAs), which are the instruments of compliance for more than 12,000 power and industrial plants taking part in the scheme.
The European Commission is preparing to propose in July measures to create scarcity in the market.Yet market participants fear intervention will fall short of fixing the problem.
“EUAs are like confetti at the moment,” said Mark Meyrick, head of the carbon desk at Eneco Energy, a sustainable energy firm in the Netherlands.
Without the EU deepening its 2020 target beyond a 20 percent cut in emissions against 1990 levels, there is little reason to expect the market to escape the doldrums, he told Reuters.
“The market is not going to crash radically from here with 7 euros to go, and we could be bumping along the bottom for a while.”
Analysts say the surplus will likely exceed an equivalent of 1 billion tons of emissions by the end of 2012, taking into account a healthy supply of U.N.-backed emissions offsets which can be used for compliance in the EU scheme.