Bloomberg News

Lithuania Doesn't Object in Principle to CO2 Backloading

December 04, 2012

Lithuania doesn’t object in principle to the European Union’s proposal to strengthen the carbon market by delaying auctions of some permits, said Stasile Znutiene, an official at the country’s Environment Ministry.

The European Commission, the EU’s regulatory arm, is seeking government support for a draft measure to postpone sales of 900 million allowances to 2019-2020 from 2012-2015 to help prices rebound after they fell to a record low amid oversupply. EU member states are scheduled to indicate their positions on the stopgap measure at a meeting on Dec. 13.

“In principle Lithuania does not object to the commission’s carbon backloading proposal, but wishes that member states are consulted before the adoption of auctioning calendar for every year,” Znutiene, head of the climate change policy division in the pollution prevention department of the environment ministry, said by e-mail.

At stake is the cost of pollution in the world’s biggest cap-and-trade system after prices plunged to a record today on concern that the EU won’t be able to enact this year the so- called backloading measure. The glut of permits caused by the economic crisis rose to almost half of the average annual pollution limit in the 27-nation EU, knocking the price of carbon 77 percent down since 2008.

The commission’s proposal needs 255 out of 345 votes in the bloc’s Climate Change Committee, whose weighted ballot system favors larger countries. Lithuania has seven votes. Should the Committee approve the measure, it will become subject to a three-month scrutiny period by governments and the European Parliament.

To contact the reporter on this story: Ewa Krukowska in Doha at ekrukowska@bloomberg.net

To contact the editor responsible for this story: Lars Paulsson at lpaulsson@bloomberg.net


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