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Carbon market

EU Lawmakers Seek Carbon Deal as Fix Likely to Survive in Panel
By Ewa Krukowska – May 27, 2013
Bloomberg
Several European Union lawmakers are seeking a compromise over a rescue plan for the region’s carbon market, aiming to win majority support for the measure in the EU Parliament after a possible victory in a committee next month.
Bas Eickhout of the Greens group in the European Parliament and four other members of the assembly’s environment committee from various parties seek one-time carbon-permit supply curbs to tackle a record glut of allowances, according to a document obtained by Bloomberg News. That would limit the original proposal designed by the region’s regulator and could help attract votes of some lawmakers who are undecided on whether to back the carbon-market intervention plan.
The draft measure to delay emission-permit auctions is the first step toward strengthening the world’s biggest cap-and-trade market after prices slumped to all-time lows in April. It’s scheduled for a new vote in the environment panel on June 19 and then in the whole Parliament on July 2 after the assembly declined to support it last month.
“It is clear that the environment committee is unlikely to reject it, but it can still be rejected in the plenary,” Eickhout said in a phone interview today. “That’s why it is important to have a good proposal that could carry majority support in the whole Parliament.”
Carbon allowances for delivery in December rose as much as 2.3 percent to 3.64 euros ($4.71) a metric ton today on the ICE Futures Europe exchange and were at 3.53 euros as of 4:20 p.m. in London. The contract tumbled to an all-time low of 2.46 euros last month on concerns that policy makers will fail to agree a rescue plan for the market.
Exceptional Circumstances
Eickhout, Corinne Lepage of Alliance of Liberals and Democrats, Sabine Wils from the European United Left-Nordic Green Left as well as Linda McAvan andDan Jorgensen of the Socialists and Democrats group, proposed a total of nine amendments to the carbon fix designed by the European Commission, according to the document.
The commission may “in exceptional circumstances” adapt the auctioning timetable to ensure an orderly functioning of the market, according to their proposal. The wording they are seeking is in line with a modification of the draft measure sought by Ireland, which holds the rotating presidency in the EU Council of Ministers in first half of this year.
“The idea behind tabling the Council text is to make future negotiations between Parliament and Council easier, and to put pressure on those member states who do not have a position yet,” Eickhout said.
Qualified Majority
The Parliament is considering the first element of the carbon-market fix plan, or a draft change to the EU emissions trading law that would enable postponing auctions of some allowances from 2013-2015 to 2019-2020. In the second step, a separate regulation will set out the details of the delay.
The strategy, known as backloading, has divided policy makers and the industry. To be enacted, it needs qualified majority support by member states and approval from the Parliament.
The European People’s Party, the biggest group in the Parliament, is planning to put forward an amendment to reject backloading and several changes aimed at restricting the proposal, according to its lawmaker Eija-Riitta Korhola.
The rejection proposal will “most certainly” be voted down by the environment committee, Korhola, who oversees the draft measure in the EPP, said on her Twitter Inc. account today. “Plenary is another thing,” she said.
New Modifications
Parliamentarians on April 16 voted 334 to 315, with 63 abstentions, to prevent the commission’s proposal to alter the EU emissions-trading law. They opted to send the measure back to the committee for further talks.
Members of the environment panel have until 6 p.m. in Brussels today to submit modifications to the draft measure. Matthias Groote, the chairman of the committee and lawmaker in charge of the backloading proposal in the Parliament, said last week he wasn’t planning to put forward any own amendments before today’s deadline.
In his role as the supervisor of the carbon fix, Groote can drawing on modifications sought by various members of the panel and offer a compromise change that could win support of various political groups after today and before the committee vote next month, according to Eickhout. In the plenary session parliamentarians will vote on the environment panel’s report and the amendments it backed.
“The plenary decision is going to be a close call again,” Eickhout said. “Some people just want a rejection. But there’s also some EPP members realizing it’s better to have a compromise.”

Four Lawmakers Propose Limiting EU Carbon Fix to One-Time Move
By Ewa Krukowska – May 27, 2013
Bloomberg
Four members of the European Parliament are seeking a one-time delay to carbon-permit sales to tackle a record glut, limiting a proposal by the region’s regulator, according to a document obtained by Bloomberg News.
Bas Eickhout of the Greens group in the assembly, Linda McAvan of the Socialists and Democrats group, Corinne Lepage of Alliance of Liberals and Democrats, and Sabine Wils from the European United Left-Nordic Green Left proposed a total of 9 amendments to the stopgap carbon fix designed by the European Union’s regulatory arm, according to the document.
The changes will be voted on by the Parliament’s environment committee in June.
The lawmakers proposed the European Commission may “in exceptional circumstances” adapt the auctioning timetable to ensure an orderly functioning of the market. The wording they are seeking is in line with a modification of the draft measure sought by Ireland, which holds the EU’s rotating presidency in the first half of this year, according to the document.
The environment committee is scheduled to vote on the emergency plan to prop up carbon prices on June 19 after the whole Parliament declined to support it last month, referring it to the panel for further talks. The next plenary vote is planned on July 2.