Jan. 25 (Bloomberg) -- European Union carbon permits had their biggest weekly drop since June 2011 as the bloc’s lawmakers failed to agree whether to support an EU commission plan to temporarily withhold supply through 2015 to fix a glut.
Carbon permits for December dropped 5.1 percent to close at a record 4.11 euros ($5.53) a metric ton, taking the weekly loss to 20 percent, according to data from the ICE Futures Europe exchange in London. Certified Emission Reduction credits for December fell 5.6 percent to 34 euro cents a ton as of 4:59 p.m.
“There is a lot of behind-the-scenes activity at the European Commission and the member states level to try to find a solution” to the surplus, Paolo Coghe, an analyst at Societe Generale SA in Paris, said today in an e-mailed note.
The proposal by the commission to alleviate the glut by delaying sales of some permits caused a rift among governments, industry organizations and lawmakers. The commission’s plan is “absurd” and will hurt German industry by pushing up their costs, Joachim Pfeiffer, Chancellor Angela Merkel’s CDU party economy spokesman, said yesterday.
--Editors: Alessandro Vitelli, Rob Verdonck