EU freezes vast raft of carbon credits in bid to relaunch ETS

The EU said on Friday it would temporarily freeze 900 million tonnes of carbon emissions quotas to revive prices on its ill-fated CO2 Emissions Trading Scheme (ETS) to reduce pollution. The agreement to "backload", or postpone the release of these credits to the market until 2020, is intended to raise prices for the pollution quotas traded by more than 11,000 industrial entities, the bloc's Lithuanian presidency and Climate Action Commissioner announced.
Despite a rally on the back of the decision, prices remain at less than a third of their level at the start of 2013, at under five euros ($6.70). An EU source said the bloc anticipates prices rising to "between eight and 12 euros" on the back of this "one-off measure" deemed necessary following a prolonged recession. The decision received the backing of 26 EU states, with only Poland and Cyprus voting against the radical intervention, EU sources said.