FRANKFURT (Reuters) - Europe’s effort to protect the climate faces “a decade of stagnation” without quick action to save the EU carbon market, the chief executive of German utility E.ON said in a newspaper interview on Saturday.
“European emissions trading is a patient on his deathbed; either we cure him quickly, or he dies,” Johannes Teyssen told Sueddeutsche Zeitung.
“And that would have unpredictable negative consequences, not only for climate protection,” he added.
The European Parliament on April 16 rejected a Commission proposal to temporarily remove some of the oversupply that has overwhelmed the $148 billion market for permits to emit carbon dioxide, sending the market to a record low and raising questions about its survival.
As a result, investors will find it no longer profitable to put their money into clean technologies, Teyssen said.
“Money will start flowing back into an economic activity that should have been consigned to history,” he added.
While utility companies supported the Commission proposal, energy intensive industries opposed it, arguing it would push up energy costs when Europe is already suffering a competitive disadvantage compared with the United States, which has benefited from abundant supplies of shale gas.
In the interview Teyssen denied that his stance was in part aimed at making energy from brown coal, such as that produced by rival utility RWE, more expensive.
“Nonsense. It’s not about hurting the competition. We are all having a hard enough time as it is,” he said.
“Carbon dioxide must have a price and if emissions trading is irreparable, then we will need a tax that countries can introduce on their own,” he said, adding that the UK was already moving in this direction.
Reporting by Jonathan Gould; Editing by Greg Mahlich