Saturday

10th Jun 2023

EU carbon market boosts emissions, NGOs say

  • "We need to scrap the ETS and implement fair climate policies," say pro-green NGOs (Photo: DerGuy82)

Around 75 pro-green NGOs are jointly calling for the EU to scrap its carbon emission-trading scheme (ETS) ahead of a European Parliament vote to reform it.

Set up in 2003, ETS is central to the EU’s carbon reduction plan in its fight against climate change by allowing companies to trade CO2 permits on the market.

Read and decide

Join EUobserver today

Become an expert on Europe

Get instant access to all articles — and 20 years of archives. 14-day free trial.

... or subscribe as a group

But the NGOs, including Friends of the Earth and Carbon Trade Watch, say the money-making scheme has instead increased emissions and encouraged land grabs in poverty-stricken regions.

“The EU's flagship policy to address climate change has diverted attention from the need to transform the system’s dependency on fossil fuels and growing consumption, resulting in increased emissions,” said Joanna Cabello, from Carbon Trade Watch, in a statement on Monday (18 February).

The ETS covers more than 12,000 power plants and factories throughout the 27 member states.

The environmentalist advocates say structural loopholes in the policy allow companies and governments to purchase carbon permits, for instance, in nations in Africa.

The permits – or offset projects - then entitle the company to pump out more carbon at home.

Meanwhile, the offset projects have a knock-on effect on poorer countries, says Isaac Rojas, from Friends of the Earth Latin America and Caribbean.

He cited land grabs, human rights violations, community displacements, conflicts and increased local environmental destruction as a consequence of the scheme.

Rojas pointed out that other market mechanisms and financial products, like forest carbon offsets and biodiversity offsets, "follow the same logic which allows, and offsets, deforestation, forest degradation, biodiversity loss and water pollution”.

The NGOs' call for an alternative climate change policy comes on the eve of a vote on Tuesday in the European Parliament’s environment committee.

Deputies are seeking to plug the gaps in a carbon trading emissions market that has plummeted in recent months.

Permits are now selling under €5, down from around €20 in 2008, harming business incentives to cut emissions or invest in clean technologies.

The vote is on a proposal by the European Commission to backload member state allocation of permits to companies. The proposal would essentially postpone regular auctions in the hope of driving up prices and restoring investor confidence.

Some 30 large corporations back the commission’s idea.

They also signed a plea to encourage the deputies to vote through reforms they believe will make the market far more lucrative, reports the Guardian.

The businesses say the market is saturated with too many free permits, driving down the price.

Holding back the sale of the permits would instead revive the market and spur innovation, say the companies.

"A Yes vote would send a positive signal about the European parliament's commitment to its flagship emissions reduction scheme and begin to restore investor confidence in the EU's energy policy," said the companies in their letter, according to the Guardian.

Brussels moves to tackle slumped carbon market

The European Commission on Wednesday announced short-term plans to bolster the carbon Emissions Trading Scheme, its flagship environment project undermined by rock bottom carbon prices.

EU upbeat on 2020 carbon targets

The EU predicts it will meet its 2020 targets to reduce carbon emissions and increase use of renewable energy, despite backsliding by some countries.

Opinion

The 'BlackRock exemption' has no place in the EU's due diligence directive

With the EU's Corporate Sustainability Due Diligence Directive, there's an opportunity to harness the power of investment for truly sustainable activities. But to do this, it must not allow the 'BlackRock exemption' and instead cover institutional investors and asset managers.

Final push for EU-Mercosur deal, amid deforestation fears

Finalising the EU-Mercosur agreement is a priority for the EU and the upcoming Spanish EU council presidency, ahead of the summit with Latin America and the Caribbean countries to be held in Brussels on 17 and 18 July.

Latest News

  1. Negotiations on asylum reform to start next week, says MEP
  2. EU gig workers compromise dubbed ‘a disaster for workers’
  3. EU's one-off chance to influence Laos taking over ASEAN chair
  4. Belgian bâtonnier on Russia: 'You can have a client you don't like'
  5. EU's proposed ethics body 'toothless', say campaigners
  6. Study: 90% of Spanish inflation 'driven by corporate profits'
  7. If Spanish economy is doing well, why is Sanchez poised to lose?
  8. EU lawyers for Russia: making 'good' money?

Stakeholders' Highlights

  1. Nordic Council of Ministers20 June: Launch of the new Nordic Nutrition Recommendations
  2. International Sustainable Finance CentreJoin CEE Sustainable Finance Summit, 15 – 19 May 2023, high-level event for finance & business
  3. ICLEISeven actionable measures to make food procurement in Europe more sustainable
  4. World BankWorld Bank Report Highlights Role of Human Development for a Successful Green Transition in Europe
  5. Nordic Council of MinistersNordic summit to step up the fight against food loss and waste
  6. Nordic Council of MinistersThink-tank: Strengthen co-operation around tech giants’ influence in the Nordics

Stakeholders' Highlights

  1. EFBWWEFBWW calls for the EC to stop exploitation in subcontracting chains
  2. InformaConnecting Expert Industry-Leaders, Top Suppliers, and Inquiring Buyers all in one space - visit Battery Show Europe.
  3. EFBWWEFBWW and FIEC do not agree to any exemptions to mandatory prior notifications in construction
  4. Nordic Council of MinistersNordic and Baltic ways to prevent gender-based violence
  5. Nordic Council of MinistersCSW67: Economic gender equality now! Nordic ways to close the pension gap
  6. Nordic Council of MinistersCSW67: Pushing back the push-back - Nordic solutions to online gender-based violence

Join EUobserver

Support quality EU news

Join us