Tag Archives: carbon-markets
EU Carbon Price Crisis Spreads To Australia
Last updated on 10 May 2013, 7:33 am By John Parnell The crisis in the European carbon market has spilled over to Australia with the government forced to postpone a promised tax cut. Australia placed a charge of A$24 per tonne on the largest emitting industrial sectors with its powerful mining industry hit hard. A planned increase in the tax free income tax threshold that was linked to money raised by the carbon tax has now been postponed. “If the carbon price forecast is revised down, as it will be in the budget, then there’s no case for the additional measures that we had put in place,” Climate Change Minister Greg Combet confirmed on Wednesday. Opposition leader Tony Abbott, who has pledged to scrap the tax and the country’s climate commission should he win September’s election, said it was further evidence that Julia Gillard’s government could not be trusted. “This is a government that talks about living in the Asian century, yet they gave economic policy-making in Australia over to the Europeans,” said Abbott. The struggling EU Emissions Trading System (ETS) will be partially linked to the Australian market in 2015 and fully linked in 2018. A recent vote by the European Parliament against reforms of the struggling ETS raised fears that market faced a period of stagnation. Asked by RTCC if Australia was reviewing the plans for the link-up, a spokesperson for Minister Combet said: “Australia remains committed to the link with the European Union carbon market.” They added that carbon markets including the EU link-up were part of the process of building momentum for the UN’s 2015 global climate treaty, due to come into force in 2020. A combination of reduced economic output as a result of the recession and the absence of more ambitious EU climate targets mean the cap has been placed too high and the demand to trade emission permits is too low. In April the proposal to withhold 900m credits from the next phase of the system to this imbalance in supply and demand, was voted down 334-315. A second vote on a tweaked version of the reforms will take place in the first week of July. Continue reading
World Bank Urges CO2 Price
Environmental Leader – 08/05/13 World Bank President Jim Yong Kim has urged the world’s environmental ministers to combat climate change by implementing a five-point plan that includes putting a price on carbon dioxide emissions, improving agricultural practices and ending fossil fuel subsidies. Kim urged more countries to roll out price mechanisms either through a tax on carbon, indirect taxation, regulation or creation of a carbon market, Reuters reports. The plan also includes building low-carbon cities and sharing new technology that will save energy, Kim told about 30 of the world’s energy and environment ministers gathered in Berlin for informal talks on a new global climate deal to take effect in 2020. The Berlin gathering follows a meeting in Bonn last week of more than 600 government officials and NGOs who met t0 discuss a new global climate deal due to be signed in 2015 to succeed the current Kyoto Protocol, according to Reuters. US negotiators pushed nations to scrap coal, gas and oil subsidies by 2020, a step they said could cut emissions 10 percent under business-as-usual levels by mid-century. The European Union Emissions Trading Scheme, the largest global carbon market, has struggled over the past year suffering from record low prices that analysts say could inch closer to zero unless policymakers take action, either through backloading or some form of long-term structural change. Carbon prices hit their lowest point April 16 after the European Parliament rejected an emergency plan to boost the ailing EU carbon market . European carbon prices did rebound last week after German Chancellor Angela Merkel said the EU should take action on a plan to postpone the supply of permits. California’s carbon auction has fared better. Earlier this year, California raised about $176 million selling GHG emissions permits in its second carbon auction, with businesses paying $13.62 per metric ton of carbon, exceeding analysts’ expectations and selling at $2.91 above the reserve price. The Feb. 19 auction sold a little over half as many allowances with a reserve price set 71 cents higher. The price increase is in line with California cap-and-trade regulations, which say that the auction reserve should increase annually by 5 percent plus the rate of inflation. Continue reading
E.ON Urges Action To Save European Carbon Trade: Paper
FRANKFURT | Sat Apr 27, 2013 12:31pm EDT (Reuters) – Europe’s effort to protect the climate faces “a decade of stagnation” without quick action to save the EU carbon market, the chief executive of German utility E.ON said in a newspaper interview on Saturday. “European emissions trading is a patient on his deathbed; either we cure him quickly, or he dies,” Johannes Teyssen told Sueddeutsche Zeitung. “And that would have unpredictable negative consequences, not only for climate protection,” he added. The European Parliament on April 16 rejected a Commission proposal to temporarily remove some of the oversupply that has overwhelmed the $148 billion market for permits to emit carbon dioxide, sending the market to a record low and raising questions about its survival. As a result, investors will find it no longer profitable to put their money into clean technologies, Teyssen said. “Money will start flowing back into an economic activity that should have been consigned to history,” he added. While utility companies supported the Commission proposal, energy intensive industries opposed it, arguing it would push up energy costs when Europe is already suffering a competitive disadvantage compared with the United States, which has benefited from abundant supplies of shale gas. In the interview Teyssen denied that his stance was in part aimed at making energy from brown coal , such as that produced by rival utility RWE, more expensive. “Nonsense. It’s not about hurting the competition. We are all having a hard enough time as it is,” he said. “Carbon dioxide must have a price and if emissions trading is irreparable, then we will need a tax that countries can introduce on their own,” he said, adding that the UK was already moving in this direction. (Reporting by Jonathan Gould; Editing by Greg Mahlich) Continue reading
