Retroactive changes proposed to the rules of the European Union emissions trading system will punish the investors who were first in the market, said a Deutsche Bank AG official.
“Retroactive or retrospective changes to policy are very troubling because they can end up penalizing investors who deployed capital in good faith and were first movers,” said Caio Koch-Weser, vice president at the bank and member of the United Nations advisory group on climate finance.
Spain’s discussion of retrospective cuts to feed-in tariffs was not very helpful earlier in the year,’’ Koch-Weser said yesterday in Cancun, Mexico, at the Green Solutions conference. “Thankfully that has now been resolved.” The bank finds the proposed ban by the European Commission on some Certified Emission Reduction credits “equally troubling. Such retroactivity should be avoided.”
The commission has proposed to ban some offsets from Jan. 1, 2013, four months before the end of the period for which factories and power stations can hand in allowances and credits for the second phase of EU carbon market, the world’s largest.
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