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EU lawmakers adopt draft reform of carbon market
December 15, 2016 / 8:17 AM / in a year

EU lawmakers adopt draft reform of carbon market

BRUSSELS (Reuters) - Lawmakers in the European Parliament Environment Committee on Thursday adopted a long-awaited draft proposal for a reform of the carbon market after 2020, including a higher rate at which permits should be removed from the market.

The words "Knock out the toxic tonnes" are seen on a giant ball during a protest by environmental activists in front of the European Parliament in Brussels February 23, 2015. REUTERS/Francois Lenoir

The political groups in the body also endorsed a draft proposal that will push for a doubling of the rate at which the Market Stability Reserve (MSR) soaks up excess allowances to 24 percent in the four years until 2022.

Benchmark European carbon prices were down 2.2 percent on Thursday, after the vote. A day earlier the Dec-16 contract had rose on expectations of the vote going ahead after EU lawmakers reached a compromise deal. CFI2c1

The EU’s emission trading system is designed to make big polluters pay for their emissions by buying carbon permits, but a surplus of carbon credits has depressed prices leading the European Commission to try to reform the market.

Reporting by Alissa de Carbonnel and Nerijus Adomaitis; editing by Robert-Jan Bartunek

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