ONE day renewable energy looks like a sunrise industry, the next, tumbleweeds are blowing around a setting solar panel. What has changed? The price of emitting carbon dioxide.
In 2005 the European Union created the world's first proper carbon market, the EU Emissions Trading Scheme (ETS), which compels highly polluting industries to buy permits to emit CO2. The number of permits is limited, so the idea is that supply and demand set a price that encourages the development of a low-carbon economy. A rising price with no wild fluctuations sends an economic signal to invest in clean energy. But it's not working.
The price of a tonne of CO2 on ...the ETS has had a roller-coaster ride - soaring one minute, plummeting the next. In the past year it has lurched from over €30 to €8, and now languishes at around €10. Disastrously, such low and unpredictable prices for CO2 ...
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