We might actually get something out of the Rio +20 Earth Summit in June.
Citi’s Meg Brown said she expects “peer pressure between leaders coupled with accountability to the public back home via 24hr media reporting” to strengthen climate policy and push renewable investments ahead of the conference.
Above all, Europe will have to respond to its failed carbon permits:
The most embarrassing sustainability policy situation at present is the state of the EU’s Emissions Trading Scheme. Unlike other participants at the conference who have not yet started pricing CO2, the EU acted early, opening its scheme in 2005. However since then the scheme has failed to deliver a price effective in stimulating low carbon investment. In fact the scheme has delivered windfalls to power generators, steel and cement companies that were allocated emission permits for free. It has been beset by problems such as stolen permits, reselling of offsets which should have been retired from use once submitted and IT problems delaying the integration of national registries. And any proposed reforms take years to navigate the bureaucracy of Brussels and survive powerful lobbying interests.
We expect the EU’s embarrassment at home to result in measures to reform the market to be proposed before the conference. As we write, a review of the EU’s scheme is being fast tracked to report within 2 months (ie just in time for Rio).
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