Petteri Taalas, Member of Fortum Board of Directors, in Brussels: Carbon market reform urgently needed
PRESS RELEASE 20 January 2015
"Companies engaged in Europe's decarbonisation initiatives need a clear price signal to drive their operational and investment decisions today. A higher carbon price would reduce the need for subsidies for renewables and would increase member states' auctioning revenues taking pressure away from national taxation. We call on MEPs to support advancing the start date for the MSR to 2017 as well as the immediate transfer of the 900 million backloaded EU allowances into the MSR," said Member of Fortum Board of Directors and Director General of the Finnish Meteorological Institute, Mr. Petteri Taalas in his speech.
Mr. Petteri Taalas attended a high-level event to debate the urgency to reform the EU Emissions Trading Scheme (ETS) in the European Parliament in Brussels today. The event was organized by the energy-sector organisations, Eurelectric and Eurogas. The Market Stability Reserve (MSR) proposal is currently being processed by the Parliament and Council. The ETS is the flagship of the Union to reduce greenhouse gas emissions and the Market Stability Reserve is an important step to restore the credibility of the scheme.
Companies need long-term confidence on climate policy
The current carbon market, with a huge excess of allowances and low prices, does not provide any incentive for low-carbon activities. Today, nearly all investments into new power generation in Europe are based on various support mechanisms. In the future, extensive investments in low carbon generation will be needed to replace aging power plants and to meet the tightening emission reduction targets. Therefore, long-term stability and predictability of the operating environment are needed to enable those future investment decisions.
The market stability reserve would increase stability and predictability in the allowance market benefitting electricity consumers and producers alike, but would keep the emission cap unchanged. A well-functioning emissions trading system improves the competitiveness of low-carbon technologies and enables the climate targets to be met with the least cost.
In connection with the reform of the ETS, the competitiveness of European industry has to be maintained. Carbon costs have to be compensated for in the European energy-intensive industry, if there are no corresponding carbon constraints in other countries. "This must be an integral part of the revision of the emissions trading directive that will be started after the decisions on MSR have been made," concluded Mr. Taalas.
Esa Hyvärinen, Senior Vice President, Corporate Relations, tel. +358 40 826 26469
Kari Kankaanpää, Senior Manager, Climate Affairs, tel. +358 50 453 2330
Fortum’s purpose is to create energy that improves life for present and future generations. Catering to the versatile needs of our customers, we generate, distribute and sell electricity and heat, and offer related expert services. Our operations focus on the Nordic and Baltic countries, Russia and Poland. In 2013, Fortum’s sales totalled EUR 6.1 billion and comparable operating profit was EUR 1.6 billion. We employ approximately 8,800 people. Fortum’s shares are traded on the NASDAQ OMX Helsinki. www.fortum.com