E.U. could limit carbon emissions permits

The European Union could act to support the currently low price of carbon emissions permits, according to UPI.

The E.U. its carbon trading scheme was implemented in 2005 and has had limited effect on overall carbon emissions, in large part because of declining economic activity in the wake of the financial crisis.

With concerns that the scheme could continue to prove ineffectual with carbon prices at their current level, the European Parliament's Industry, Research and Energy Committee submitted a draft proposal that would allow the European Commission to withhold some undetermined number of the emissions permits.

The decision has drawn strong opposition from industry members, many of whom stockpiled a considerable number of the permits in preparation for the tightening standards.

"The pricing of allowances should be left to the market," said Poland's Industry Commissioner Antonio Tajani, according to the news source. "Prices would recover by themselves as soon as the economy were to pick up."

With these potential changes coming to the market, Portuguese Espirito Santo Investment Bank told Reuters that the current price of 9 euros per permit could more than double by the end of the year, reaching between 15 euros and 20 euros per permit. This would pose a serious challenge to the region's coal-fired power plants, while supporting nuclear and hydroelectric plants.

PennEnergy's Research area offers details on some global carbon emissions rules.

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