BRUSSELS (Reuters) – Talks between negotiators for the EU nations and the European Parliament over reforms to the EU Emissions Trading System (ETS) after 2020 ended without an agreement early on Friday, EU presidency Estonia said.
The EU is aiming to reach a deal over carbon market reforms ahead of United Nations climate talks in November. A spokeswoman for the Estonian presidency of the EU said another round of negotiations would be required, but did not give a date for the talks.
The European Union’s ETS, a cap-and-trade permit system to regulate industry pollution, has suffered from excess supply since the financial crisis, depressing prices.
As a part of reforms to fix the oversupply, a modernization fund is to be set up, with the proceeds from some of the permit sales, to help fund low-carbon technology in poorer EU members.
The European Parliament wants an emissions performance standard to be set for recipients of the cash, which would effectively rule out coal-fired power plant funding.
However, the EU Presidency opposed this request, creating an impasse at the talks, the International Emissions Trading Association (IETA) said.
“We urge negotiators to redouble their efforts to reach a deal at the next … meeting,” IETA CEO and President Dirk Forrister said in a statement.
“An agreement is needed to send a strong signal that the EU is serious about its leadership role in the international climate policy arena.”
The benchmark EU carbon contract was down almost 1 percent on Friday at 7.34 euros/ton.
Reporting by Susanna Twidale and Alissa de Carbonnel, editing by David Evans