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Half EU Carbon Glut Caused by High Prices, Climate Mundial Says

Energy efficiency projects encouraged by high carbon prices caused almost half of Europe’s glut of permits and a plan to temporarily withhold allowances will exacerbate the oversupply by 2020, said Climate Mundial Ltd.

The oversupply, which will reach about 1.8 billion metric tons by April, was formed when factories and power stations reacted to the start of the world’s biggest carbon market in 2005, Daniel Rossetto, managing director of Climate Mundial in London, which advises in emission markets, said in a report dated Jan. 23. They retrofitted boilers, installed heat-recovery systems, improved lighting and insulation to cut energy use and the need for emission allowances, he said.