Report from the Commission to the European Parliament and the Council – The state of the European carbon market in 2012

This report on the functioning of the carbon market is presented in accordance with Articles 10(5) and 29 of the EU Emissions Trading System Directive. The report was envisaged by the ETS Directive in 2013, the first year of phase 3. At their informal meeting in April 2012, Environment ministers were informed of the Commission's intention to bring forward the first report and prepare it in 2012, which they welcomed.

The EU Emissions Trading System (EU ETS) has produced since its start an EU-wide carbon price signal that influences daily operational and strategic investment decisions. From 2013 onwards it will cover around half of the greenhouse gas (GHG) emissions in the EU. The EU ETS is widely recognised as a liquid market with a functioning infrastructure and inspires an increasing number of countries to follow the European lead and put in place domestic carbon markets, such as Australia, South Korea and China.

The purpose of this first report is to analyse the functioning of the carbon market and to consider whether regulatory action is needed, as foreseen under Article 29 of the EU ETS Directive.

EUR-Lex: COM(2012)652: Follow the progress of this document through the decision-making procedure http://eur-lex.europa.eu/legal-content/EN/HIS/?uri=COM:2012:652:FIN

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