Nearly 50 investors have thrown their weight behind a call for EU lawmakers to maintain a strong carbon price in the region.
The Net Zero Asset Owner Alliance (NZAOA) joined Allianz SE, AkademikerPension, Sampension, the Church of England Pension Board and tens more in a letter to EU leaders as they prepare to renegotiate the Emissions Trading System (EU ETS).
EU Commissioners will today hold an ‘orientation debate’ on the future of the EU ETS, which is undergoing a scheduled review to see if it is still fit for purpose, and will present an initial proposal for discussion.
Lobbying has been mounting in recent months, ahead of formal negotiations, with some European industry bodies calling for the price of carbon to be halved to around €40 per tonne as part of the review, while others insist it must remain at current levels to avoid changing the goalposts for companies investing in long-term decarbonisation.
Today, 46 investors representing €12trn in assets told legislators “the ETS should remain the bedrock of Europe’s clean industrial strategy, with the upcoming review offering an opportunity for evolution, not dilution”.
Jacob Ehlerth Jørgensen, chief ESG officer and head of investment analysis at Sampension, said Europe’s net zero transition presented “a big investment opportunity”.
“There is capital ready to be invested – but investors and businesses alike rely on clear and predictable rules as a basis for informed investment decisions,” he added, saying a strong carbon price was “vital for that certainly”.
Eric Christian Pedersen, head of responsible investment at Nordea Asset Management, warned that changing the trajectory of the EU ETS “would amount to pulling the rug from under exactly those companies who have shown due diligence and prepared themselves in time, while rewarding laggards”.
The European Council will meet next week to discuss the legislation and it will be officially reviewed next month.
