New UN carbon mechanism 'uneasy fit for ETS'

UN plans to develop a new market mechanism to cut CO2 are likely to compound the oversupply problem in the EU emissions trading system, experts have warned

UN plans to develop a new market mechanism for carbon emission reductions are likely to compound the oversupply problem in the EU emissions trading system (ETS), experts have warned.

In light of the large supply of credits into the EU ETS from the UN's existing clean development mechanism (CDM) and from the EU's own carbon allowance sales, it will be "very hard" to find demand for any more credits, according to a new consultancy report compiled for the European Commission's climate department.

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