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13th Aug 2022

Big energy firms pocket money from emissions trading

Five big energy firms are boosting their profits at the expense of consumers from the EU’s emission trading scheme, according to a WWF report seen by a German paper.

A report by leading environmental NGO World Wildlife Fund (WWF) seen by FAZ reveals that big energy companies in Germany abuse the EU's emissions trading scheme, under which companies can trade rights to emit greenhouse gasses.

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The firms Eon, RWE, Vattenfall, EnBW and Steag are all being allocated a certain number of quotas by the German government for free.

But the firms include the market value of the emissions rights in their energy prices for consumers, leading to artificially high energy costs.

The German SPD party, which sits in the country's government, has mooted a plan to auction emission rights to firms rather than to give them away for free.

SPD parliamentarian Ulrich Kelber said that this would not lead to a jump in prices "because the electrical power monopolists are calculating the fictional value of the pollution rights already into the [energy] price today, while completely pocketing the profits."

The WWF report comes at the one year anniversary on Thursday (16 February) of the coming into force of the Kyoto protocol, aimed at reducing emissions of carbon dioxide and five other greenhouse gases worldwide.

In a common bid to comply with the Kyoto protocol, EU states have pioneered the emission trading scheme, which allows companies that exceed their CO2 quotas to buy emissions permits from companies not meeting their targets.

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