Finally the EU has taken action on the HFC credits, which are miserably low quality offsets from destroying industrial gases for pennies on the Euro.
Of course the carbon market investors have been upset to see them go. Here’s what Bloomberg had to say about it, including a comment from me:
CO2 Investors say Ban on Certain Offsets Raises Risk
2011-01-24 16:18:12.475 GMT
By Catherine Airlie
Jan. 24 (Bloomberg) — The European Union’s vote to ban
certain types of United Nations offsets raises investment risks
and the cost of borrowing money, the Carbon Markets and
Investors Association said.
“It cannot be emphasized enough that stable regulation is
central to the ability to raise money for the fight against
climate change,” CMIA said in an e-mailed statement today. The
EU’s ban on some offsets goes against that, they said. “Doing
otherwise will reduce the pool of capital that is available, by
increasing the risk, and also the cost of capital.”
The EU’s 27 national governments agreed to ban as of May
2013 the use of UN-sponsored offsets linked to
hydrofluorocarbon-23 and some nitrous oxide credits. EU Climate
Commissioner Connie Hedegaard welcomed the member states’
decision on industrial gas offsets, saying the credits that are
to be banned created a perverse incentive for investors.
Environmental groups including CDM Watch support the
restrictions. Investors in HFC-23 projects, including Italy’s
Enel SpA, had called on the commission and member states to
limit the scope of the ban and delay its entry into force.
“If investors want a durable, long-term, stable carbon
market they need to champion the regulations that will best
address climate change,” Jerome Whitington, a climate
specialist at Dartmouth College in Hanover, New Hampshire, said
by e-mail. “Their protest over the change in rules now seems
disingenuous at best, and the short-term interests of investors
should remain low priority for policy makers.”