Wake-Up Call: A Disastrous Week for Carbon Trading

[xchrom]

http://www.spiegel.de/international/europe/drop-in-carbon-price-underscores-disastrous-week-for-carbon-trading-a-879769.html


German Economics Minister Philipp Rösler and Environment Minister Peter Almaier are at loggerheads over a proposal to rescue Europe's cap-and-trade system.

For those involved in European Union climate policy, the German regional election in Lower Saxony on Sunday was a nail-biter. The hope for many was that Germany's pro-business Free Democratic Party (FDP) would suffer defeat and leader Philipp Rösler, who has been under pressure within his party for weeks now, would be forced to step down as economics minister. But that didn't happen. Instead, Rösler ended up in a stronger position than before, and the flagship project of Europe's climate policy settled deeper into a lifeless coma.

Rösler is against a short-term plan to boost prices on the European Emissions Trading System (ETS), while Environment Minister Peter Altmaier of Chancellor Angela Merkel's conservative Christian Democratic Union (CDU) party favors it. Rösler opposes any intervention in the carbon market and stands by the market process that has resulted in a collapse in the price of carbon allowances. The plan, called backloading, would take 900 million carbon allowances out of the system temporarily to help boost the carbon prices and partially relieve a massive glut. But the German government is split on the plan, with Merkel remaining on the sidelines. Whatever happens, market players say it is already clear that Germany's stance will be pivotal.
"I have been surprised about how unwilling Angela Merkel has been to step into this debate and resolve it on behalf of the government," said Mark Lewis, a climate market analyst at Deutsche Bank. "It's extremely frustrating. It's taking longer and longer. And as a result, the market is going lower and lower."

The German Chancellery did not respond to a request for comment.

[tama]

1. Green capitalism

Ain't working.

[wtmusic]

2. Don't throw that baby out with the green bathwater.

Cap and trade ain't working, because it's programmed for failure.

Economic incentives have been instrumental in getting EVs on the road. The small amount of wind power we do have was made possible by the Production Tax Credit. Whenever pols actually wrap their heads around fee-and-dividend, it will be a game-changer in keeping carbon underground.

[tama]

3. I make distinction

between capitalism (all power to Capital!) and market and collective decision making.

Market is neutral, it's just place of exchange - goods, ideas, etc., and as such not dependent from any economic theory. Also gift economies take place on market.

And cap and trade is programmed for failure because it's capitalist smoke screen.