The global carbon market is predicted to rise in value by 15% this year after the approval of the European Union’s plan to defer sales of pollution permits, according to an energy sector analyst firm.
This measure, known as ‘backloading’, is designed to tackle oversupply in the market by delaying the auction of 900 million carbon credits. It is predicted that carbon prices could increase from their current value (less than €5 per metric ton) to an average of €7.50.
The European Commission says this decision will help with “restoring the short-term balance in the European carbon market”. BG Energy Solutions, an energy efficient solutions expert, welcomes this measure, but emphasises its role as a short-term solution.
Duncan Biggins, Managing Director of the energy controls firm, says: “As the EU Climate Action Commissioner Connie Hedegaard notes, the structural challenges of the market also need to be tackled. We look forward to seeing these be addressed in the 2030 climate and energy framework.”
He adds: “It’s also important to remember that a carbon market can only form part of our management of carbon emissions. We also need to significantly reduce our energy use – further investment in energy management solutions is vital.”