The financial crisis is affecting international economies
also as far as climate is concerned. If the economic
downturn is causing industrial production to shrink, this
will likely entail less emissions thereby requiring a lesser
effort from countries participating to the EU ETS.
Recession is turning the Netherlands and Spain from
buyers to potential sellers of the Certified Emission
Reductions they bough to cover up in advance their
position in this phase of the scheme. Both countries now
hold more CERs than they are likely to be able to cash
into the scheme, which allows a 2.5 percent limit on the
annual cap and they could be selling them, or use them to
achieve more ambitious reductions beyond the EU ETS.
Moreover, the financial crisis’s effect on energy
commodities, and in particular on UK gas, is likely to help
cut emissions up to 10 billion tonnes in the EU this
coming winter, due to much lower gas prices compared to
last year. In fact, lower gas prices induce switching from
coal to the less-polluting gas to produce electricity.

• This news is extracted from the Emission Trading Monitor : a weekly column that summarises the latest news on international climate change agreements, the updates on the carbon market and the energy and technology updates in the realm of climate change. Go to the web page and see all previous issues.
• This week: Polish AAU bill approved, aviation cap deadline officially postponed, recession and climate change,
  new chair confirms EU commitment Yvo de Boer on Copenhagen goals, and the carbon market. Download July 20-24, 2009 issue [pdf – 157 Kb]