The EU ministers have reached a compromise on the carbon market emissions reform and agreed on a common position to defend regarding the Emission Trading System (ETS). Negotiations with the European Parliament can begin from now on.
Talks on reforms have dragged on for 18 months, with EU nations split over measures to strengthen prices, how not to impinge on competitiveness and how best to manage funds to help those lagging behind to modernise their economies. The text of the compromise calls for measures to strengthen prices by doubling the rate at which the scheme’s Market Stability Reserve (MSR) soaks up excess allowances and by cancelling surplus permits yearly after 2024 that have been three years in the reserve, above a ceiling of 650 million.
Under the current ETS trading processes, which spreads from 2013 to 2020, the majority of carbon permits are sold through government auctions, and most of the rest are given to the industry.
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