Aug. 24 (Bloomberg) -- European Union governments are set to meet twice next month for talks about a change to the carbon law that would pave the way for a measure curbing oversupply of emission permits, according to an EU presidency official.
Representatives of national governments are due to meet in Brussels on Sept. 7 and Sept. 17 in a working group to prepare ground for a decision by ministers on an amendment to the carbon law that would clarify the right of the EU’s regulatory arm to delay some auctions of permits as of 2013, said the official, who declined to be identified, citing policy.
The amendment is the first element of the EU plan to alleviate the oversupply of allowances in the world’s biggest carbon market at the beginning of its next trading phase that runs until 2020. In the second step the European Commission will propose a separate measure to postpone sales of an as-yet unspecified number of permits.
EU carbon prices have fallen 41 percent in the past 12 months as an economic crisis has cut demand from factories and power stations. The bloc will be oversupplied with about 1.1 billion permits by the end of the current 2008-2012 trading period, according to Bloomberg New Energy Finance. The surplus can be carried over to the next phase starting in 2013.
There is a chance that the change to the EU carbon legislation could be adopted by the end of October, depending on the willingness of governments and the European Parliament, whose approval is also necessary for the amendment to pass, the official told Bloomberg News.
EU environment ministers are next due to meet on Oct. 25 in Luxembourg. The gathering will be hosted by Cyprus, the current holder of the bloc’s six-month rotating presidency.
EU Climate Commissioner Connie Hedegaard said last month she was “quite confident” that the bloc’s member states will approve changes to the supply of carbon permits, an idea known as backloading, before the end of this year.
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