Enigin Update - Unrest over EU Energy Efficiency and Carbon Trading Policies
PETER Vis, a senior European Commission official, has broken with protocol to warn that the European Commission's draft Energy Efficiency Directive could "undermine" the bloc's carbon market, EurActiv report.
It is extremely rare for Commission officials to comment on draft EU laws, but Vis said yesterday that new binding rules Günther Oettinger, the European commissioner for energy, is due to propose next week are not ideal.
According EurActiv official in the climate department are fuming that new energy efficiency regulations, due on 22 June, would apply not just to buildings and vehicles, but industrial sectors already covered by the EU's emissions trading scheme (ETS), which puts a price on carbon by placing a limit on CO2 emissions.
Critics claim that a duplication of rules could depress carbon prices, as energy efficiency measures cancel out the need for pollution permits, leading to a market glut and price collapse.
Vis told a conference organised by the German Marshall Fund of the US in Brussels, yesterday: "More than half of those measures [in the draft] target the installations covered by the emissions trading scheme. We have got two policy approaches knocking up against each other and that isn't helpful."
"We're big supporters of energy efficiency," Vis is reported as statin by EurActiv, "but we have to be careful not to undermine a system that is in place now – the ETS – which is a global leader".
Internal EU studies the impact of the new policy predict carbon prices falling from €25 a tonne to either €14 a tonne, or close to zero, as a result of the energy efficiency drive. Such a drop in the Carbon price would dent budgeted revenues for low-carbon investment across the EU in the third phase of the ETS, which runs from 2013-2020.
Henry Derwent, president of the International Emissions Trading Association (IETA), told EurActiv: "For a European climate policy which has been focused on achieving [carbon] prices high enough to drive investment to deliberately undermine and reduce that price seems quite extraordinary."
As far as European based Enigin Distributors are concerned, pushing forward with energy efficiency is vital, a buoyant carbon price helps when dealing with large corporations who will try to reduce their energy waste and will turn to Enigin plc for energy efficiency equipment. Meanwhile, smaller companies are not directly affected by the Carbon price but still turn to Enigin to save energy and reduce energy costs.
The European Commission by Sebir Tumblr
