EU Emissions Trading System Registries (Suspension of Transfers) Debate
Full Debate: Read Full DebateLord Barker of Battle
Main Page: Lord Barker of Battle (Conservative - Life peer)(13 years, 10 months ago)
Written StatementsOn 19 January, following a number of successful cyber attacks on EU member states’ emissions trading system (EU ETS) registries, the European Commission suspended all internal and international transactions within all the EU ETS registries. These registries are the repositories for EU emission allowances and an important part of carbon market trading.
The UK agreed with the European Commission that EU member states should not be able to reopen registries until they had provided sufficient evidence to the European Commission that their registries meet a number of minimum security requirements. The UK registry is widely seen as one of the most secure registries in Europe with at least one market participant recommending this week its clients should use the UK registry. The UK’s registry administrator, the Environment Agency, earlier this week submitted the required evidence to the Commission. We have received confirmation this morning that the UK registry will reopen on Friday 4 February at 7 am.
While it is important to ensure a minimum level of security now to ensure the reopening of the registries, the UK will continue to press the European Commission to ensure that registry security across Europe is raised above this level. This is vital to ensure continued confidence in this growing market.
The temporary suspension of registry transfers has had an impact on the carbon market, though this has been concentrated in spot trading, (which allows for instant delivery of allowances bought on the secondary market), which represents only 10% of trading on the carbon market. The futures market, which is predominately based in the UK and accounts for the remaining 90% of the carbon market, has shown only a limited level of disruption. Trading here has continued at broadly the same volumes as before the registries were closed and the impact on the EU emission allowance price has been limited.