EU climate change policy in crisis after MEPs vote against high CO2 prices

The European Union's climate change policy is on the brink of collapse today after MEPs torpedoed Europe's flagship CO2 emissions trading scheme by voting against a measure to support the price of carbon permits.

The price of carbon crashed up to 45 per cent to a record-low €2.63 a metric ton, after the European Parliament rejected a proposal to change the EU emissions-trading laws to delay the sale of 900m CO2 permits on the world's biggest carbon markets.

The European Commission measure, known as "backloading" was aimed at artificially raising the price of EU carbon permits by restricting supply after they fell to a record low in January due the economic slowdown and contraction in manufacturing across Europe.

The rejection of the measure is expected to trigger further falls in the price of carbon, to as low as €1 and could herald the end of an EU system which was aimed encouraging investment in "clean" technologies by pricing high CO2 emissions from smokestack industry or coal-fired power plants out of the market.

READ MORE:  http://www.telegraph.co.uk/finance/newsbysector/energy/9997868/EU-climate-change-policy-in-crisis-after-MEPs-vote-against-high-CO2-prices.html