I've been beating a fairly solitary path on this for a while, and in the process making myself unpopular with the major players in the electricity industry (which provides another clue to the huge rent-seeking potential of cap-and-trade) and their representatives. But, judging by this article in this weekend's Sunday Times, it looks like others may also be coming to share my view.
The Association of Electricity Producers' position is that:
"properly constructed, and with continued political support, the EUETS will provide a reliable carbon price".
One slight problem: the politicians keep moving in the opposite direction from a properly constructed system (actually, the concept as well as the implementation is fundamentally flawed, but that's beyond their comprehension). Today we learn from the AEP (supposedly representative of the whole electricity industry but really one of several associations, including the ENA, ERA, Gas Forum, and UKBCSE, which operate as the Big Six cartel's patsies) that:
"the temperature is rising in the EU ETS negotiations and a further 'Trilogue' meeting takes place today. In particular the eight eastern Member States led by Poland, and also Italy have been pushing for further concessions. The French Presidency is now reportedly offering further concessions:
- Member States with over 30% coal-fired generation (was previously 60%) can phase in auctioning over the period 2013-16;
- Large electricity users can be compensated for the impact of higher electricity prices; compensation will be based on benchmarking and must comply with specially-adopted state aid rules;
- Member States can meet up to 70% of their effort-sharing target through international credits."
Germany has more than 30% coal-fired generation. And it was Germany, home of two of our largest electricity companies (RWE and Eon), along with France/EDF, which gained the most at our expense from the game-playing in the last round. Prepare to be shafted by our continental friends again.
Utterly predictable, and utterly useless.