The price of European carbon permits should be at least 85 GBP (pounds), about eight times the present price, if they are to meet their goal of getting polluters to cut emissions, according to a government-sponsored study, reported The Sunday Times. The study also suggests a "green tax" on top of the carbon price.
The findings will be published later this year by Chris Hope of Cambridge University's Judge Business School. Currently, carbon permits under Europe's Emissions Trading Scheme (ETS) are trading at about 11 pounds per ton.
Pricing of European carbon emission futures in March dropped after Britain's second emissions permit auction, selling 4 million permits at 10.98 euros (approximately 9.98 GBP) a ton. However, pricing has rallied, reaching 12 euros (approximately 10.90 GBP) a ton in recent days, after European utilities and other emitters of greenhouse gases failed to meet their year-end targets.
The Sunday Times also reported that big oil companies sped up their withdrawal from renewable energy last week when BP announced that it was closing two solar-panel plants in Spain and part of another in America.
These cutbacks, which will result in 620 job losses, follow BP's recent announcement of a 30 percent spending cut across the company, including at its renewables business, reported The Sunday Times. Earlier this year the company decided not to invest in the British wind-power industry. However, BP's chief executive backs the need for global carbon pricing.
Shell also announced plans to scale back its renewable energy business and drop all new investment in wind, solar and hydrogen energy to focus on oil, gas and biofuels, in part due to sinking oil prices.
