Sweden and other countries oppose the calls to delay the new EU carbon market

A joint?paper of the countries revealed that Sweden, Denmark and Finland have resisted calls from other European governments to postpone the EU's forthcoming?carbon markets, as political pressure increases for the bloc reduce?energy prices.

The paper focuses on the second carbon market in the European Union, also known as ETS2, which will be implemented from 2028 and impose a CO2 price for fuels used to heat homes and transport vehicles.

The EU has already delayed by one year the launch of the market and has accelerated the distribution of the revenues from the scheme to the governments. The EU has delayed the market's launch by one year and fast-tracked the distribution of revenues to governments from this scheme.

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In a paper distributed among the?EU government and seen by the?, Sweden and other countries stated that any?further?postponement or amendments relating to the market-based ETS2 price would significantly undermine the effectiveness? of EU climate policy.

The EU's ambassadors met on Wednesday in order to approve the tighter controls that Brussels had proposed on ETS2 pricing after 19 countries requested this last year. The four countries' papers said that after these changes were passed, the EU shouldn't interfere with the system.

They said that the debates about further changing ETS2 "are reducing?the credibility of the system and increasing uncertainty for investment decisions made by households and firms."

ETS2 aims to encourage the switch to 'electric vehicles' and cleaner heating systems by placing a price on CO2 emissions and recycling the revenue from the scheme for subsidising electric cars and energy saving home renovations.

Brussels is also under pressure from certain governments and industries to weaken the existing carbon market. This puts a price for CO2 emissions by industry and power plants.

Later this year, the European Commission will present a "review" of the current carbon market. EU diplomats say that some governments see this as a way to change ETS2 since it's governed by the exact same law. (Reporting and editing by David Holmes; Kate Abnett)

(source: Reuters)