Economics editor Daniel Wetzel at Germany’s center-right national daily Die Welt here writes that the Brexit may be the end of the Paris climate treaty and that it is a climate-political nightmare for the EU.
Already, he notes, the price of CO2 emissions certificates has plummeted to near low-grade levels, see chart at Die Welt.
The Die Welt journalist writes that those holding these pollution-permitting certifcates saw a large chunk of value get wiped out. Already at the end of last year the certificates had a value of near 9 euros. Now they are hovering at less than 5 euros.
The reason for the plunge in price, Wetzel writes, is that Great Britain will no longer be bound to the European Emissions Trading system, and so dozens of UK power plants will no longer need their certificates and will likely dump them on the European market, causing their price to plummet further. The result, Wetzel writes:
For industrial plants all over Europe there will be hardly any financial incentive left to invest in CO2-saving efficiency technology.”
New political constellation at Westminster
Activists are still hoping that Britain will remain in the Emissions Trading Scheme, even after exiting the EU, just as non EU member Iceland, Norway and Lichtenstein are currently doing. Wetzel asks whether Britain will continue staying commited to ambitious CO2 reductions as it has in the past. One factor that speaks against continued commitment to reducing CO2 emissions is that “among Brexiteers and EU-skeptics in Unitted Kingdom – as is the case with the German AfD – the number of climate skeptics is especially high“.
In part not only is the man-made impact on climate questioned, but whether climate change is happening at all. In a new political constellation in Westminister, the high British climate targets may not be possible to maintain in the future.”
A weakened Europe in climate negotiations
Here Wetzel cites a recent research paper by the Chatham House that looked at the possible impacts on climate policy should Britain vote to leave the EU. The Chatham Report has in its conclusion:
A diminished EU, for its part, would be weaker in managing relationships with Russia, which already seeks to divide it and to negotiate bilateral energy deals with individual member states. The EU would also be less able to influence global climate negotiations alongside other major powers such as China and the United States, as it would represent a much smaller share of the global economy and of global emissions. This would not serve the longterm interests of either the UK or the EU.
The report concludes that in the event of a British exit (which is now the case), Britain would be freer to decide its energy policies on its own without meddling from Brussels.
Climate policy-making center of gravity shifts eastwards
What bodes especially ill for European climate policy, Wetzel writes, is that the “decision-making center of gravity” will now likely shift eastwards to more climate-policy obstinate countries, such as coal-producing Poland, and the Czech Republic.
Wetzel even warns, citing the Chatham House report, that should Britain not live up to its climate protection commitments, it could face “international criticism, and in the worst case sanctions from other countries“.