Europe’s carbon markets aren’t doing too hot, huh?

posted at 4:31 pm on April 21, 2013 by Erika Johnsen

I missed it earlier this week in all of the news-craziness, but the 27-member European Union’s cap-and-trade scheme doesn’t seem to be doing very well — and after the European Parliament rejected an attempt to artificially hike up carbon permit prices to try and bolster the flailing program, some analysts are wondering if the whole thing isn’t about ready to go kaput:

More banks and trading houses could abandon Europe’s carbon market, making government auctions of permits more likely to fail, after the European parliament on Tuesday rejected an emergency measure to prop up prices.

Prices for EU carbon permits under the Emissions Trading Scheme (ETS) fell 40 percent to under 3 euros on Tuesday after lawmakers rejected a plan to temporarily cut permit supply by 15 percent for fear that higher carbon prices would cost European jobs and harm economic growth.

About 5,000 companies generating half of the EU’s greenhouse gas emissions must surrender a carbon permit for each tonne of carbon dioxide they emit. Some factories receive permits for free, while most power firms buy them from companies with a surplus or from state-backed auctions held almost every day.

Campaigners and traders warn the carbon price could now fall below 2 euros or even to near zero in the coming weeks, and government sales could fail if they don’t meet minimum price requirements, as banks that act as liquidity providers pull out.

Good thing they rejected the plan, too — the eco-radicals are obviously most put out about the no-confidence vote, but can you imagine what even higher energy prices would do to Europe’s many stagnating economies? The cap-and-trade scheme has been on the strugglebus ever since the recession hit back in 2008, but I suppose that’s what happens when you’re apparently determined to learn the hard way that economic concerns will always trump environmental ones.

Meanwhile, much of Europe is steadily resisting the shale production that is responsible for the United States’ lately decreased carbon emissions. Kind of funny that the U.S. never even signed the Kyoto protocol, but since 2005 our emissions have been falling faster than Europe’s — without even trying to orchestrate or do anything except earn a profit. Weird how that happens, isn’t it?

U.S. carbon-dioxide emissions have fallen dramatically in recent years, in large part because the country is making more electricity with natural gas instead of coal.

Energy-related emissions of carbon dioxide, the greenhouse gas that is widely believed to contribute to global warming, have fallen 12% between 2005 and 2012 and are at their lowest level since 1994, according to a recent estimate by the Energy Information Administration, the statistical arm of the U.S. Energy Department.

While other factors, including a sluggish U.S. economy and increasing energy efficiency, have contributed to the decline in carbon emissions from factories, automobiles and power plants, many experts believe the switch from coal to natural gas for electricity generation has been the biggest factor.


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Unicorn sales though……….

CW on April 21, 2013 at 4:35 PM

If not for the extremist Conservative right-wing ultra-Republican anti-Obama racist hate-the-poor anti-immigrant homophobes who are such a minority as to be irrelevant that they are so powerful, we wouldn’t have this problem.

Liam on April 21, 2013 at 4:43 PM

Imagine that, people don’t want to invest their hard earned money into an obvious scam.

Axion on April 21, 2013 at 4:47 PM

A consensus is forming that there has been no actual warming for about the past 12 years. Even the IPCC is saying this. This would let carbon dioxide off the hook, as a “dangerous pollutant” that is causing the planet to overheat. Will the left and the media in this country ever acknowledge this? Will the EPA cease its insane attempts to regulate CO2? I doubt it.

TarheelBen on April 21, 2013 at 4:53 PM

While other factors, including a sluggish U.S. economy and increasing energy efficiency, have contributed to the decline in carbon emissions from factories, automobiles and power plants, many experts believe the switch from coal to natural gas for electricity generation has been the biggest factor.

And others do not.

I’m not even arguing the point; just tired of yellow rain.

Axe on April 21, 2013 at 4:58 PM

It was never intended to work.

Just put money in to the pockets of AlGore types, and perhaps a little wealth redistribution to third world hellholes while they were at destroying any actual functioning economic entities.

LegendHasIt on April 21, 2013 at 4:59 PM

I suppose that’s what happens when you’re apparently determined to learn the hard way that economic concerns will always trump environmental ones.

This could be said of out president, no? Unless he intends to take down the economy by playing with his friends and our money in eco-games?

Don L on April 21, 2013 at 5:02 PM

This carbon BS is almost as bad as global warming. It’s all BS in oder to get another source of tax money.

mixplix on April 21, 2013 at 5:15 PM

But, but, we will make the requirements more restrictive and set the penalties higher. Surely, it will work then. /lib

trs on April 21, 2013 at 5:18 PM

just tired of yellow rain.

Axe on April 21, 2013 at 4:58 PM

…we’re all pissin’ outside!…trying to save water!

KOOLAID2 on April 21, 2013 at 5:20 PM

About time. This whole scheme would be knee-slapping hilarious and a great Aesop’s fable if it weren’t true. Just think, this was a whole imaginary market selling an imaginary product — the “ability” to legally emit the product of perfect combustion. The Europeans literally set up a market to sell hot air.

/You can’t make this stuff up.

AZfederalist on April 21, 2013 at 5:26 PM

I wholeheartedly believe that the coal to nat gas portion of the 15% decrease is likely to be around 5-7%. The rest of it can be contributed to the shrinking economy.

They can have 15 surgeons trying to doctor the GDP statistics, but that’s all it is, a gigantic lie. There is no way there is actual growth, nor even stagnation, we have absolutely contracted by an amount that would shock most of us, myself included.

I suppose that we will never know the truth. But it’s a fact that at the very beginning of the ‘recovery’ I was telling people to not believe the government. Watch what happens with energy, it won’t lie.

preallocated on April 21, 2013 at 5:31 PM

Good thing The Goracle pulled out of the carbon markets before the hit.

GarandFan on April 21, 2013 at 6:15 PM

We have to ask ourselves how carbon (C) got involved with this at all. Carbon credits? Plants love CO2, that’s how we get our oxygen (O). No CO2, no flora generated O. It’s that simple. It’s not just economics winning here, science is winning too.

Winning.

Mojave Mark on April 21, 2013 at 6:59 PM

This kind of stuff doesn’t help much: Mafia Probe Nets $1.7bn in Clean Energy Assets

The multi billion-dollar haul included the seizure of 43 wind and solar energy companies, 98 properties and 66 bank accounts belonging to Vito Nicastri, a businessman described by authorities as a frontman for the Sicilian Mafia.

Nicastri, 57, was once dubbed ‘Lord of the Wind’ for his holdings in wind farms which prosecutors say were funded by extortion, drug sales and other illicit activities.

(Strange, links to this story seem to be disappearing.)

slickwillie2001 on April 21, 2013 at 7:01 PM

….and it was 37 degrees this morning in NJ. When will people wake up to this entire global warming farce?

Wine_N_Dine on April 21, 2013 at 7:02 PM

So when does Al Gore get sued?

slp on April 21, 2013 at 7:14 PM

Isn’t it amazing that the Europeans have figured out that their “Cap and Trade” program is a flop and costing them jobs and financial security, while the idiots in our government haven’t a clue that this administration with it’s rules and regulations is doing exactly that. An educated electorate could put a stop to this madness, but the 2012 election showed us that that is a long way off.

savage24 on April 21, 2013 at 8:36 PM

The best solution: a zero dollar carbon permit.

unclesmrgol on April 21, 2013 at 10:38 PM

Wasn’t the delay for the new regs related to the fact that upon closer examination it was discovered that most natural gas power plants wouldn’t pass them either? That pretty much puts the EPA between a rock and a hard place until some government genius discovers a way to dance around the two energy sources without looking blatantly obvious.

parke on April 21, 2013 at 11:34 PM

It’s not just Europe, either.

Australia, which has fared better than most Western economies in controlling government deficits since the 2007 recession, is also finding pricing on their carbon permits is falling through the floor. Unfortunately, they’ve been relying upon substantial government revenues from the permits and their resales and that is vanishing rapidly.

Say, remember all the advocates of carbon-credit trading told us we could just trust the market? Looks like they were right! The market is telling us the value of carbon credits is rapidly approaching ZERO.

Adjoran on April 21, 2013 at 11:39 PM

….and it was 37 degrees this morning in NJ. When will people wake up to this entire global warming farce?

Wine_N_Dine on April 21, 2013 at 7:02 PM

NJ? AS a whole? Never.

We just got an inch of snow! Libs here just as stupid.

WryTrvllr on April 21, 2013 at 11:59 PM

Political agendists pretending to be scientists and economists trying to drive the world into a leftist state. And it fails.
Surprise!

pat on April 22, 2013 at 2:05 AM

Good thing they rejected the plan, too

Maybe the federal government has, but CA hasn’t. Their tying their CO2 to Canada.

California and Quebec are linking even as the emissions- trading system across the European Union falters. EU carbon allowance prices dropped to a record low April 17 after lawmakers voted against a plan to ease a supply glut and resuscitate the world’s biggest emissions market.

At least some in the state are fighting it.

California is winning the race to the bottom.

Patriot Vet on April 22, 2013 at 8:16 AM