“The EU ETS is often considered the cornerstone of the European climate and energy policy framework. So any new 2030 Energy Framework has to address the weaknesses in the ETS system, tackling the large surplus of allowances depressing the carbon price,” he says.
Davey says Europe cannot repeat the experience of last year’s so-called backloading reforms, whereby 900million carbon emission permits were temporarily removed from the ETS in order to prop up the price of such permits in Europe’s cap-and-trade system.
“In
