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Reuters Jun 13, 2013, 04.39PM IST LONDON: Societe Generale lowered its forecasts for European Union carbon prices on Thursday on concerns about obstacles to a plan to cut supply in the EU’s Emissions Trading System (ETS). The bank cut its forecasts for 2013 EU carbon permits, called EU Allowances (EUA), by 36 per cent to 4.1 euros a tonne, 2014 EUAs by 42 per cent to 4.3 euros, 2015 EUAs by 32 per cent to 5.7 euros and 2016 EUAs by 15 per cent to 8.1 euros. The ETS is over-supplied with permits as recession has dampened demand. Last year, the European Commission drew up a proposal to intervene in the market by delaying the sales of some EUAs to prop up low prices. The European Parliament in April rejected the proposal, sending carbon prices to record lows. Its environment committee will hold another round of voting on support for the world’s biggest emissions market on June 19. If the proposal clears, a plenary vote is scheduled for the first week of July. Since April, some EU lawmakers have been working on changing the wording of the proposal to gather more support ahead of the committee vote next week. On Wednesday, senior lawmakers from three major European Parliament parties said they had struck a deal which could allow regulators to intervene in the market. However, Societe Generale said there were still many regulatory and political hurdles to clear. “Even if the vote at parliamentary level in July is a positive one, it is very unlikely that the actual modifications to the auction regulations will be agreed upon and ultimately written into law before the end of the year,” it said. “There is the possibility that the proposal that gets approved may look slightly different in substance, if not in spirit, from the one we have been discussing thus far.” Continue reading →