EU Emissions Permits Threaten Investment

European energy companies have dropped investment projects worth billions of euros due to compulsory European greenhouse gas emissions permits, a senior energy executive has announced.

Presenting a World Energy Council report on Europe's energy vulnerabilities, E.ON's chief operating officer, Johannes Teyssen, said the EU should be more flexible in reforming its Emissions Trading System, writes Reuters.

"A lot of investment projects have been cancelled in the last couple of months," says Teyssen, who adds that at least four power station projects in Germany have been dropped recently.

EU rules state companies would have a transition period phasing in the auctioning of carbon dioxide emissions permits.

But the industry is now being told it would have to buy 100 percent of allowances at auction from 2013, Teyssen says.

The report also says the EU should seriously consider using more nuclear energy to meet its climate change targets.

By staff writer