EU may prop up carbon market by withholding permits

Another central planning success.

Reuters reports:

European Union politicians backed a proposal on Tuesday to withhold carbon permits from the bloc’s emissions trading scheme (ETS) from 2013, paving the way for the EU Commission to intervene in the market to prop up low prices.

EU Parliament’s industry committee passed a proposal which would let the EU Commission take measures that “may include withholding of the necessary amount of allowances” from the 2013-2020 phase of the EU market as part of a wider debate on energy efficiency…

Member states are divided on whether to impose extra carbon costs on their industries amid tepid economic growth. Polish members of the European Parliament’s main centre-right grouping have opposed any form of set-aside.

Heavily reliant on coal, Poland is concerned about the impact of stronger carbon prices on its economy.

The European Commission itself is also split on whether to impose a set-aside, despite Climate Commissioner Connie Hedegaard being in favor…

Read the entire report.

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