EU’s emissions trading scheme ‘back on track’

Reforms aim to 'reiterate support' for scheme

The European Union’s system for helping countries reduce their carbon emissions is back on track despite criticism from Conservative MPs and business lobbyists.

The emission trading scheme (ETS) has been reformed to make it more effective and will be debated in the European Parliament sometime in April. However, there has been criticism from Conservative MEPs, two of whom defied David Cameron and voted against the reforms. There has been speculation that the reforms could end up being ‘watered down’ by the time they make it to the parliament vote.

The EST in its current form has failed due to low permit prices

(Image source - ABC)

In their current form, the reforms will hold back some of the EST carbon trading permits until 2019 in an attempt to stop the over-supply of permits and raise the cost of carbon emissions. The original scheme was designed to reduce the carbon emissions of countries by making them buy permits to allow them to release carbon dioxide into the atmosphere, with the view that the cost of permits would make countries want to lower their emissions and invest in renewable energy technologies. However, the scheme has been seen as a failure because of the low cost of these permits, along with the fact that many of them were given away for free. 

The reforms would introduce a system of ‘backloading’, which would hold back permits from auction for several years. Rob Elsworth, policy officer at the campaign group Sandbag, said: "The road to structural reform of the ETS starts with backloading. Today's vote puts us firmly on that road. What's more it reiterates support for the EU's flagship climate policy, the ETS. Abandoning it at this point would have left the EU with an even more politically charged debate around alternatives."