Market fears two-tier EU ETS post-2012

Carbon emission

Analysts warn that a possible two-tier EU ETS could emerge, as the West may take a direct or indirect punitive stance on China's clean development mechanism project (CDM) generated certified emissions reduction (CER) credits, and make this ineligible for use in Phase III (2012–2030).

"China is no doubt the largest issuer of CERs in the market, and some of its largest projects may be objected to by the EU in the future," said Emmanuel Fages, head of market analysis at French emissions trading hou