UK sells 4 million EU CO2 emissions permits

LONDON (Reuters) - The government said it sold 4 million 2008 European Union carbon emissions permits on Wednesday at 16.15 euros a tonne in the country's first auction of the allowances to emit greenhouse gases.

The auction, held by the Department of Energy and Climate Change, was open to participants globally and raised 64.6 million euros (53 million pounds) for the Treasury.

Britain plans to auction a further 25 million EU allowances (EUAs) next year.

It has said that revenues will not be earmarked specifically to develop renewable energy or fight climate change.

The European Commission allows governments to auction up to 10 percent of the allowances issued in Phase 2 of the EU's Emissions Trading Scheme (2008-2012), to allow industry to prepare for Phase 3 (2013-2020), when EUAs will no longer be issued for free to many participants.

Benchmark EUAs were trading 13 cents higher at 16.68 euros a tonne following the auction, recovering from a fresh 20-month low hit earlier Wednesday.

The UK Debt Management Office, which oversaw Wednesday's auction, said it was more than four times oversubscribed.

(Reporting by Nina Chestney and Michael Szabo; Editing by Anthony Barker)