A manufacturers’ lobby group has welcomed new proposals from the European Commission to combat climate change.
The EEF said the proposals to reform the Emissions Trading Scheme (ETS), designed to increase the contribution of renewable energy, would not be damaging to industry.
However, the group said the draft must be carefully monitored to ensure no damage to competitiveness.
Although it backed renewable energy, saying it has an important contribution to make to a ‘balanced and secure’ energy supply in the future, the EEF added that a realistic strategy is now needed to avoid the risk of undermining the credibility of the proposal.
It said there were still concerns the Commission was not ensuring that allocations reflect the technological abilities of each sector to reduce its emissions.
Martin Temple, chairman of EEF, said: “Our concern has always been that if a badly-designed ETS forced European companies to incur extra costs this would damage our competitiveness and increase emissions by forcing companies to relocate elsewhere.
“We are relieved the Commission has recognised this danger and kept the door open for 100% free allocation of carbon permits for some sectors.”
He added that for some industries, the proposed target will require a huge expansion of capacity in a short space of time.
“Currently the target is challenging to the point of being unrealistic, and if we are to have any hope of meeting it, the government must develop a cost-effectic strategy as a matter of urgency.”
© Crimson Business Ltd. 2008
