ETS bust

Unfortunately not our one…it is the European ETS that is in trouble:

Europe’s largest employers’ group has warned against meddling in the carbon market to prop up sagging prices, just a day after one of the continent’s top energy executives declared the market “dead” and demanded urgent intervention to save it.

In a letter to parliament released on Wednesday, Philippe de Buck, president of BusinessEurope, warned that moves to withdraw carbon permits from the market to bolster prices “would, if implemented, create further uncertainty and price volatility, and establish a risky precedent of rapid political interference in the market”.

Mr De Buck, whose constituents have struggled to forge a common position on the issue, said he wanted “an open discussion … about the general climate policy framework and the longer term future” of the carbon market.

In December, the European parliament’s environment committee approved a resolution calling for the removal of more than 1bn surplus carbon permits from the market in an effort to shore up prices. The industry committee will vote on a similar measure at the end of this month.

Other elements of corporate Europe, particularly heavy industry, argue that such meddling would make a mockery of the market.

Johannes Teyssen, chief executive of Germany’s EON, urged policymakers to make fixes. “Let’s talk real: the ETS is bust, it’s dead,” Mr Teyssen said in Brussels this week, adding: “I don’t know a single person in the world that would invest a dime based on ETS signals.”

 I know of one person who would invest based on ETS signals…Nick Smith.

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  • Anonymousecoward

    Trading thin air.

    What could possibly go wrong.

  • Colin

    The ETS in all its glory does nothing for the environment, except killing more trees to satisfy the need for a pointless paper trail!

  • Gazzaw

    Carbon trading is just the 21st century equivalent of the Great South Seas Bubble & will share the same demise. How well are Nick Smith’s forestry mates doing in the interim?

  • Callum

    The NZ ETS is solely for trade protection, it removes one potential environmental arguement against our export trade in markets like the EU. Remember the food miles scare? No scientific basis at all but quickly put a dent in our trade with the UK and boosted their own inneficient farming sector.

  • Paulus

    ENRON did it.

  • Stanferguson22

    In its briefing paper, MfE recommend that Nick Smith should also drastically reduce access to international carbon credits, so that our Energy Tax System (ETS) will continue to push up the prices of electricity, gas, diesel and everything else.

    In 2009, Nick said this tax was not a tax and would harness market forces to reflect supply and demand. But he changed the rules in December 2011 because the price dropped. Now MfE want him to change the rules again. This is not how markets work, and nobody can have any confidence that the ETS will ever be allowed to discover true market pricing.