UK business lobby group, the CBI, is calling on European nations to unite behind a 2030 carbon reduction target to secure the future of the Emissions Trading System (EU ETS).
The CBI says that a successful carbon market is essential to creating sustainable and secure growth in Europe. But it warns that the current EU ETS, which has been plagued by problems, is not driving investment.
The combination of the recession and the short-term focus of the EU ETS, which only caps emissions up until 2020, has provided insufficient incentives for the necessary investment in low-carbon technologies.
“Investors are ready for the low-carbon race, but right now they can’t see the finishing line. Europe urgently needs a 2030 carbon target to give investors the confidence to get going,” says CBI’s director for business environment policy, Rhian Kelly, speaking in Brussels today.
The statement comes as the European Commission unveils its proposals for reforming the carbon market.
“The Commission wants an even more robust European carbon market that provides a stronger driving force for carbon markets elsewhere,” commented Connie Hedegaard, European Commissioner for Climate Action in a statement. “But because of the oversupply in the market, the ETS is not driving energy efficiency and green technologies strongly enough.”
The first immediate step will be to with-hold the auctioning of 900 million allowances over the next three years to reduce the surplus of emission allowances in a manoeuvre known as “back-loading”.
Further down the line, the EC raises six different options for changing the structure of the EU ETS, including a permanent withholding of allowances to get rid of the surplus.
But Kelly warns that back-loading is not the answer.
“Without a long-term plan, the short-term changes being debated now are just tinkering with the market and won’t do anything for investor confidence.”
For further information:
www.cbi.org.uk
ec.europa.eu/clima/policies/ets/index_en.htm
ec.europa.eu/clima/policies/ets/auctioning/third/documentation_en.htm
Related stories:
UK’s industrial strategy should play to strength in green tech, says CBI (8-Nov)
Renewable, nuclear and CCS industries unite to call for UK decarbonisation target (5-Nov)
CBI warns UK government away from over-dependence on gas (15-Oct)
UK businesses calls for 2030 carbon target to unleash investment (8-Oct)
Article source: http://www.energyefficiencynews.com/i/5540/
