EU adopts ETS climate change draft. Lowers cap

A draft reform of Europe’s emissions trading system (ETS) has been adopted by the European Parliament. The cap of 2.4 percent decrease each year in emissions,proposed by the parliament's environment committee was lowered to 2.2 percent after strong campaigning from Polish MEPs. The cap-and-trade permit system aims to decrease limit on greenhouse gas emissions and allows companies to trade emissions allowances. The proposed reforms, which will now be discussed by the European Council and 28 member states, would seek to reduce the long-standing over-supply of carbon credits in the market by cancelling 800 million allowances and introducing a new mechanism to cancel a further 200 million allowances if a set threshold is reached.