By Nina Chestney
LONDON, Dec 21 (Reuters) – The credibility of the European Union’s flagship carbon trading scheme was dealt another blow on Monday after carbon prices fell to six-month lows as U.N. talks in Copenhagen failed to deliver a strong climate deal.
Traders and analysts say low prices could continue well into 2010, slowing investment in low-carbon technologies which have already been dented by tight financing due to a slow economy.
“(The low price) reinforces the idea that relying solely on the EU ETS to drive investment is probably not the answer at the moment,” said Andy Kelly, head of business development at Centrica.
(For a Q+A on what the Copenhagen accord means for the carbon market, please click here)
“This does give ammunition to the anti cap-and-trade brigade,” an emissions trader said, referring to groups who say emissions trading does not work.