Posted on 09/26/2007 3:29:09 PM PDT by Shermy
LONDON - The European carbon market will probably see a continued over-supply of emissions permits through 2008-12, damaging the credibility of the climate change policy, energy consultants Wood Mackenzie said on Tuesday.
Carbon markets are meant to drive cuts in greenhouse gases blamed for global warming by ensuring a shortage when issuing emissions permits for heavy industry. But the European emissions trading scheme (ETS) allows affected businesses to buy additional permits, or carbon offsets, from developing countries outside the scheme.
The problem is that this extra supply of offsets will easily exceed the shortage of carbon emissions permits within Europe, making it cheap for European firms to avoid cutting their own emissions at all, according to Wood Mackenzie.
"Companies subject to emissions limits under the EU ETS, and the European Commission itself, appear to be winners. The only loser seems to be the environment," it said in a report "EU ETS Phase II: A Fundamental Assessment".
"Our analysis shows that the European Commission is likely being too lenient in the allowance of (offset) imports."
The first phase of the European trading scheme from 2005-07 has now been relegated to the status of an experiment, after it emerged that businesses obtained, for free, more emissions permits than their actual carbon emissions.
A repeat of the resulting carbon price crash will not happen in the second phase from 2008-12, simply because this time permits will be valid in future trading cycles from 2013, meaning they will preserve some residual value.
"That (price crash) won't happen this time because of the uncertainty in phase 3," said lead author Paul McConnell, who added that he expected the European carbon price to stabilise at the price of offsets, currently worth some 17 euros (US$23.93) per tonne of carbon dioxide.
Over the five years of the second phase of the European scheme Wood Mackenzie estimated a shortage of EU emissions permits equivalent to some 563 million tonnes of carbon dioxide emissions.
Using some conservative estimates of carbon offset supply, however, the consultants estimated that developing countries could deliver some 768 million tonnes of permits into the European scheme over the same period.
That implied a comfortable surplus of carbon emissions permits in the European scheme, even after taking into account a European limit on the import of cheap offsets.
Story by Gerard Wynn
A repeat of the resulting carbon price crash will not happen in the second phase from 2008-12, simply because this time permits will be valid in future trading cycles from 2013, meaning they will preserve some residual value."Some" "residual" value. This is funny! And the post-2012 Kyoto scheme hasn't even began to be negotiated!
"That (price crash) won't happen this time because of the uncertainty in phase 3," said lead author Paul McConnell, who added that he expected the European carbon price to stabilise at the price of offsets, currently worth some 17 euros (US$23.93) per tonne of carbon dioxide.Well the crash won't take place because of Uncertainty? OK... Anyway I believe the last crash occured because of "oversupply" of credits by governments within a "market" system that forces them to cheat to be competitive in the first place. The "uncertainty" the cc's may or may not be worthless in a few years time is an additional way this bubble scam can burst.
You have to be retarded not to see what this scheme is.
It simply moves money from wealthy industrial countries to third world countries with nothing else changing. No change in carbon output - as if that mattered anyway...
And it only gets worse from there if you start looking at the long term consequences...
That’s okay...farmers in India will make up the difference by replacing their diesel powered equipment with treadles. It will all even out.
“It simply moves money from wealthy industrial countries to third world countries with nothing else changing.”
That’s one of the directions. There are several.
For example, Britain has latched onto the scheme so much they are plotting to create their own London-based carbon exchange to dump their phoney self-appointed credits into future American exchanges for dollars. Schwarzenegger is the big mouthpiece for the Western US version of the scam. McCain, Obama, Hillary, probably others are also pushing the scam.
Failed at manufacturing goods and services people want to buy, trys their hand at worthless paper scam.
I keep waiting to wake up and find out this is a bad dream.
Lol, I’m waiting for him to fall off!
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LOL!
That’s the idea!
Unbalanced and about to fall down!
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Very smart of you!
There hasn’t been a opportunity market for scamming Europeans like this since the Holland Tulip crash. It’s great! Just pull some “credits” out of thin air and pass a law saying everyone has to buy them.
Stacked! LOL.
Carbon....the new diamond....we pre diamond anyway :)
I think a ‘straight-jacket’ should be her next costume!! She looks ready for it, lol.
SCAM
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I just “Code-Pinked” the stack!
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