BRUSSELS (Reuters) - Carbon prices on the European Union's Emissions Trading Scheme (ETS) sank to another record low on Thursday after European politicians opposed plans to prop up the market.
The price of permits to produce carbon - known as allowances - fell to 2.81 euros a metric ton (1.1023 tons) after a vote in the European Parliament's energy and industry committee.
The vote is not binding, but is the latest sign of the difficulty the European Union is having in reaching agreement on how to intervene in the carbon market.
To try to rescue the ETS, which is meant to be central to the EU's climate change policy, the European Commission has proposed a temporary withdrawal of some of the glut of permits that has undercut the price of allowances.
But some countries and members of the European Parliament oppose withholding permits, a process known as backloading.
While important, Thursday's vote is not decisive.
There will be more important votes on the issue next month in the parliament's environment committee and a committee of representatives of member states.
Member states and parliament will consider the overall proposal, as well as the amendment to the carbon auctioning directive, which is designed to reinforce the legality of the Commission's backloading proposal.
Whether the Commission plan can pass depends on leading member states such as Britain and Germany. Continued...