Bloomberg report: Clever with numbers but what does their 30% equal?
27 April 2012
Bloomberg New Energy Finance launched its new report yesterday in Brussels, analysing the costs of moving toward a 30% GHG cuts in the EU. The report lays out a number of different possible cost scenarios if the EU moved beyond the current 20% climate target. Unfortunately the report is far from thorough and falls short of presenting an adequate picture of the true costs and benefits. CAN-Europe notes for example that the Bloomberg report does not analyse the health or social benefits of enhanced climate action, such as improved air quality or a boost to the job market, which would of course have a direct effect on costs.
The report does not propose additional financial mechanisms to support emission reductions in Central and Eastern Europe (CEE) besides trading in allowances from non-ETS sectors such as agriculture and transport. CEE countries would still benefit from this situation while moving towards a 30% emissions reductions target.
CAN-Europe is especially concerned that the report assumes that only 21% out of 30% target will be achieved domestically. The remaining 9% is expected to be delivered through clean development mechanisms (CDM) offsets.
In the “simplest scenario” the annual costs of moving from 20 % to 30% are expected to reach 3.5 bn per year on average. These are additional costs, on top of the costs of existing climate and RES target implementation. Under this scenario the ETS price is assumed to reach 33 euro per tonne while the price of non-ETS allowances is assumed to reach 8 euro.
CAN-Europe welcomes the new analysis as an important contribution in the debate about increased climate ambition. At the same time we call on Bloomberg to further develop the new study, exploring costs and benefits of 30% domestic emissions reductions.
Dismal carbon price to be fixed. We are waiting to see the plan and the ambition.
26 April 2012
Last week EU Climate Commissioner Connie Hedegaard announced a review of the Emissions Trading Scheme (ETS) by the end of this year. It may result in a limit to the number of allowances available and an end to historically low carbon prices in the next ETS trading period (2013-2020). CAN Europe cautiously welcomes this news, but only if it results in a proposal that will be ambitious, and not simply a reshuffle of the total allowances available each year between now and 2020.
Carbon price drop requires decisive action
09 December 2011
Lately, headlines about the carbon market have been alarming:
“EU carbon price falls!” “CO2 prices drop!” and “Carbon price
crashes the record!” Carbon prices are the lowest since the financial crisis of
2009. For the climate, the crucial question is not, however, how many
percentage points the carbon price has changed in the last weeks. The EU
ensuring it doesn’t miss out on a cost-efficient decarbonisation trajectory for
2050 is much more important for the climate.
It does not really matter if carbon prices are at 5, 10 or 12 euros per tonne. The fact is, the EU’s carbon market does not currently have enough ambition to avoid the EU locking itself into an unsustainable energy future. . With an overabundance of permits, coming from low demand and oversupply, there is not a strong enough price signal to help deter high-carbon investments. Without more scarcity of permits the EU will slip away from an economically viable emission reduction trajectory because prices would be too low to cost-effectively achieve 80 to 95% emission cuts by 2020, as agreed by the EU leaders in 2009.
Analysis of European Commission options to move beyond 20% GHG reductions (Jan 2012) 
