EU Presidency Sees Nations Approving Carbon-Fix Mandate Nov. 8
European Union governments will “almost certainly” approve this week a mandate to start talks on a draft carbon-market fix with the region’s Parliament, according to an EU presidency official.
Lithuania, which holds the rotating presidency of the 28-nation EU, expects member states to agree at a Nov. 8 meeting that their negotiating position will be to accept the draft measure as amended by the Parliament in July, said the official, who declined to be identified citing policy.
Carbon permits rose as much as 2.8 percent on speculation that legislative work on the fix, known as backloading because it delays sales of some permits, will accelerate. The price of emissions fell to a record 2.46 euros a ton in April amid an oversupply aggravated by the region’s recession.
“Today’s news indicates that the meeting is likely to result in a green light, in which case we expect EU permits to finish the week in the range of between 5.10 euros and 5.30 euros,” said Jerry van Houten, an analyst at Bloomberg New Energy Finance in London. “But an inconclusive result and further delays remain possible, in which case allowances are likely to come under further bearish pressure.”
EU carbon allowances for December rose 1.7 percent to 4.70 euros a metric ton on the ICE Futures Europe exchange at 1:06 p.m. in London. The bloc’s emissions trading system includes about 12,000 installations owned by power companies and manufacturers, which must surrender permits to cover their shrinking quota of carbon dioxide discharges.
Should representatives of national governments approve the mandate at this week’s meeting in Brussels, talks about the final version of the draft backloading measure will start between Lithuania, representing member states, and the parliamentary team, led by chairman of the environment committee Matthias Groote.
The outcome of negotiations will need to be backed by the assembly and by ministers before the measure, which will enable delays of carbon auctions, becomes a law. In the next stage, member states will need to vote on a separate regulation to set out the details of backloading, including the exact timing and volume of allowances to be postponed.
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