The high price of hot air

Open Europe - independent think tank calling for radical reform of the EU

In a new pamphlet Open Europe looks at the EU Emissions Trading Scheme. In its first year of operation, the scheme has raised serious questions about its organisation and effectiveness in reducing carbon dioxide emissions.
*The allocation of permits means that NHS trusts will spend about £1.3 million a year for the first three years buying up extra permits, while BP and Shell will be able to sell off the equivalent of £17 and £20 million worth of surplus permits each year.
*The UK has set a tough target, while other member states have set very loose targets. This means that the ETS will cost UK firms about £1.5 billion over the first three years, while firms in Germany will make just under a billion selling off their surplus permits.
*Overall, the EU target will not reduce emissions. Member states handed out free permits for 1,829 million tonnes of CO2 in 2005, while emissions were only 1,785 million tonnes. Emissions would have to be 44 million tonnes higher for the system to actually “bite” – in other words, for the EU as a whole, at present the system is simply not reducing emissions at all.
Read Open Europe's pamphlet: The high price of hot air: why the EU Emissions Trading Scheme is an environmental and economic failure