Monday

21st Jan 2019

Opinion

EU's flagship climate policy is sinking fast

  • The European Parliament refused to delay planned auctions of carbon allowances (Photo: European Parliament)

The Emissions Trading System (ETS) is the EU’s flagship climate policy and it is sinking fast. The stated aim is to put a price on carbon, providing a financial incentive for companies to cut their pollution and, ultimately, invest in cleaner energy sources and more efficient technologies.

For many reasons, it has not done so and the market in emissions allowances has crashed.

Read and decide

Join EUobserver today

Support quality EU news

Get instant access to all articles — and 18 year's of archives. 30 days free trial.

... or join as a group

The most recent proposal to re-float the scheme involved delaying (“backloading”) planned auctions of carbon allowances, making them temporarily more scarce in order to sure up carbon prices in the short term.

The European Parliament rejected this, with British Conservatives and centre-right MEPs from across the continent voting against the measure. Their stated aim was to avoid market “intervention,” but their scarcely concealed intent was to give European industry a free ride from climate obligations.

Conservatives are not alone in their objections. Increasing numbers of non-governmental organisations, and some left-of-centre MEPs are also calling for the ETS to be scrapped.

“The vote on backloading is the wrong debate,” according to Hannah Mowat from the Brussels-based NGO, Fern. “No amount of structural tinkering will get away from the fact that the EU has chosen the wrong tool to reduce emissions in Europe. It is inherently too weak to get the EU to where it needs to be in the necessary timescale.”

In short, it is no use reaching for some buckets when we should be heading for the lifeboats.

These criticisms face particular opprobrium from Green and Socialist MEPs and their allies who believe that the only realistic course is to “save” the ETS.

Opponents are treated as “useful idiots” playing right into the hands of those opposed to any climate legislation.

But eight years on, and several reforms later, the ETS is still failing to reduce emissions, and at the same time has even rewarded polluters with large subsidies. Why should we expect different results from doing the same thing over and over again?

Not the end of the story

Saying No to the ETS is not the end of the story. It is simply a way of refusing a forced choice, rejecting the terms of a debate that falls between rejecting legislation to address climate change and pursuing a policy that has been shown to achieve nothing.

We have already seen how “protecting” emissions trading has been used as an excuse to water down energy efficiency policies, which would be far more effective in reducing emissions.

Emissions trading also contradicts policies like feed-in tariffs which, when applied correctly, create far better price incentives to stimulate the uptake of renewable energy.

Scrapping the ETS does not mean that climate policy will fall into a vacuum.

Energy policy is largely controlled by member states rather than the EU itself, and there are important lessons to be shared at this level.

Germany’s Energy Transition (Energiewende) has seen the share of renewable energy rise from 6 to 25 percent over 10 years, with the biggest shifts driven by community and local investment rather than the energy multinationals.

This has not been driven by the ETS, but rather by a guarantee that renewables will gain access to electricity grids, providing certainty for investors.

At the EU level, the European Commission should re-focus on securing more ambitious climate targets now that “backloading” is dead in the water.

Removing the ability to circumvent domestic action by buying carbon offsets would help considerably with that goal. Ultimately, the EU needs to massively reduce its overall consumption of energy, including its outsourced emissions, which have continued to rise irrespective of emissions trading.

This does not require a single “flagship” policy to replace the ETS, so much as a sea-change in our thinking about how policymakers can help to address climate change.

The writer is an analyst at the Institute for Policy Studies in Washington and the co-author of a book on carbon trading

Obama climate speech: More hot air?

American co-leadership on climate change is desperately needed, but the gap between Obama's self-congratulatory, upbeat tone and the meagre policy is too wide.

News in Brief

  1. May U-turn on fee for EU nationals in UK
  2. French data watchdog gives Google €50m fine
  3. EU hits Russians with sanctions over Salisbury attack
  4. 'Don't look for answers to Brussels', EU tells UK
  5. Germany warns UK not to 'misuse' EU patience on Brexit
  6. Germany sent 8,658 asylum-seekers to other EU states
  7. Poll: Macron popularity up four percent
  8. 'Economy is broken' says Oxfam in global inequality report

Stakeholders' Highlights

  1. International Partnership For Human RightsKyrgyz authorities have to immediately release human rights defender Azimjon Askarov
  2. Nordic Council of MinistersSeminar on disability and user involvement
  3. Nordic Council of MinistersInternational appetite for Nordic food policies
  4. Nordic Council of MinistersNew Nordic Innovation House in Hong Kong
  5. Nordic Council of MinistersNordic Region has chance to become world leader when it comes to start-ups
  6. Nordic Council of MinistersTheresa May: “We will not be turning our backs on the Nordic region”
  7. International Partnership for Human RightsOpen letter to Emmanuel Macron ahead of Uzbek president's visit
  8. International Partnership for Human RightsRaising key human rights concerns during visit of Turkmenistan's foreign minister
  9. Nordic Council of MinistersState of the Nordic Region presented in Brussels
  10. Nordic Council of MinistersThe vital bioeconomy. New issue of “Sustainable Growth the Nordic Way” out now
  11. Nordic Council of MinistersThe Nordic gender effect goes international
  12. Nordic Council of MinistersPaula Lehtomaki from Finland elected as the Council's first female Secretary General

Stakeholders' Highlights

  1. Nordic Council of MinistersNordic design sets the stage at COP24, running a competition for sustainable chairs
  2. Counter BalanceIn Kenya, a motorway funded by the European Investment Bank runs over roadside dwellers
  3. ACCACompany Law Package: Making the Best of Digital and Cross Border Mobility,
  4. International Partnership for Human RightsCivil Society Worried About Shortcomings in EU-Kyrgyzstan Human Rights Dialogue
  5. UNESDAThe European Soft Drinks Industry Supports over 1.7 Million Jobs
  6. Mission of China to the EUJointly Building Belt and Road Initiative Leads to a Better Future for All
  7. International Partnership for Human RightsCivil society asks PACE to appoint Rapporteur to probe issue of political prisoners in Azerbaijan
  8. ACCASocial Mobility – How Can We Increase Opportunities Through Training and Education?
  9. Nordic Council of MinistersEnergy Solutions for a Greener Tomorrow
  10. UNICEFWhat Kind of Europe Do Children Want? Unicef & Eurochild Launch Survey on the Europe Kids Want
  11. Nordic Council of MinistersNordic Countries Take a Stand for Climate-Smart Energy Solutions
  12. Mission of China to the EUChina: Work Together for a Better Globalisation

Join EUobserver

Support quality EU news

Join us