Document shows that eight countries have warned the EU against a weakening of carbon markets

Spain, the Netherlands, and six other countries have urged the European Union to not dismantle the emissions trading system of the bloc, which is its primary climate change policy. This comes as Brussels searches for ways to reduce energy prices. Energy?prices are surging due to disruptions in Middle Eastern oil and natural gas supplies. Brussels faces calls from governments, including Italy, to suspend the ETS. The ETS requires power plants to purchase permits to cover CO2 emissions.

In a paper published by a group of EU countries, they said that "fundamental changes to the ETS",?calling the ETS into question, or suspending the instrument, would be a very concerning?step backwards". The paper said that weakening the scheme "would dramatically penalise those who have invested and innovated on decarbonisation". It was signed by Denmark Finland Luxembourg Portugal Slovenia and Sweden.

The ETS is designed to encourage companies to invest in a lower carbon production by putting a price on pollution. Other governments have not called for the ETS to be weakened, such as Slovakia and Czech Republic.

Officials are looking for quick fixes in order to prevent a repeat of the 2022 energy crisis, which saw Europe face record-high prices due to Russia's invasion of Ukraine and reduced gas deliveries?to Europe. The European Commission said that it would provide options for EU leaders to consider at the summit on 19th March. The European Commission's Ursula von der Leyen stated on Wednesday that Brussels is exploring a cap on gas prices, but didn't mention any changes to the ETS.

According to EU data, the ETS costs represent around 11% of average electricity bills in Europe. It results in higher costs in countries like Poland where coal power plants dominate the energy mix. The ETS contributes to their power bills at a rate of 24%. (Reporting and editing by Kirby Donovan; Kate Abnett)

(source: Reuters)