A joint statement from nine European energy and environment ministers says governments and members of the European Parliament must decide on a plan to prop up the European Union carbon market by July at the latest.
Seen by Reuters Newsagency, the statement is expected to be published officially today to coincide with discussions among members of the European Parliament on the European Commission plan.
Reuters reports there was no immediate comment from Britain’s Department of Energy and Climate Change, which is expected to release the statement.
A proposal, known as back-loading, to strengthen the Emissions Trading Scheme (ETS) by removing some of a glut of carbon allowances generated by recession was rejected by the European Parliament last month in an initial vote.
The rejection followed lobbying by energy intensive industries, concerned about the positive impact on energy prices, while at member state level, coal-intensive Poland has sought to block the plan.
Dominant EU member state Germany has failed to agree a common position, although the Germany Chancellor Angela Merkel yesterday gave a strong indication in favour of the proposal.
The issue has become a political flashpoint ahead of German elections later this year as the economy ministry opposes intervention and Germany’s environment minister voiced support.
Chancellor Merkel has now said back-loading is necessary, but that it can not be agreed until after the election in September.
The latest statement said that was not soon enough.
It called on the EU member states and parliament to “take the urgent steps necessary” to come to “a swift resolution of the back-loading proposal by July of this year at the latest”.
Interference in markets had to be kept to a minimum, but “a one-off and targeted intervention now would minimize market uncertainty” and promote investment in low-carbon technology, it said.
Reuters reports back-loading was only ever meant to be an emergency fix for a market that has collapsed to a series of record lows, with carbon allowances still priced at less than €4 a tonne.
Australia’s carbon price will revert to a market based ETS in 2015 and be linked to the EU ETS.
The EC has also opened debate on more sweeping reform of the market and the statement calls on the EU executive to deliver by the end of the year at the latest proposals on “a proper structural reform”.
The nine signatories included British Secretary of State for Energy and Climate Change Ed Davey, as well as German Environment Minister Peter Altmaier and ministers from Denmark, Finland, France, the Netherlands, Portugal, Slovenia and Sweden.
