The European Union could fail to hit its green goals unless it manages to drive carbon prices on its Emissions Trading Scheme (ETS) to around three times current levels, Spain's Acciona Energy said.
Acciona is among a group of businesses – including Royal Dutch Shell, Unilever, Philips, Deutsche Telekom and Vodafone – whose leaders met European Commission President Jose Manuel Barroso and other senior officials from the EU executive last week.
They reiterated demands for ambitious future targets on renewable energy and carbon emissions reduction, as well as to back urgent action to bolster carbon prices.
"We want to express loud and clear our commitment to all these measures," Carmen Becerril, president of Acciona Energy, told Reuters in an interview.
"For several years, we have been thinking about €20 ($26) per ton as a price. That can be a good signal," she added when asked for Acciona's view on where the carbon price needed to be.
Prices on the EU's ETS, one of the bloc's main tools for tackling climate change, have collapsed to a series of record lows after recession led to oversupply in the market. At the start of April, they slipped below €6 and traded around €7 on Thursday.
Climate Commissioner Connie Hedegaard said last month the Commission was looking at ways to revise its carbon-auctioning timetable, which should limit supply and boost the price.
Apart from backing the Commission on the need to intervene, Becerril said EU member states must agree on policy goals for 2030 to give investors time to plan long before an existing set of 2020 targets expires.
The EU's three 2020 targets are to curb carbon emissions by 20 per cent, increase the share of renewables in the energy mix to 20 per cent and cut energy use by 20 per cent, compared with projected levels.
Officially, the efficiency target is the only one of the three targets the EU is not on track to meet and the bloc is locked in difficult debate on a draft law meant to enforce energy savings.
The idea of further regulation has divided EU member states and business. Some, including utilities, have resented extra EU meddling and argued more rules could stifle growth.
EU sources said Spain was among the EU nations blocking ambition on energy saving.
But Becerril backed efficiency as a means to ensure security of supply and reduce reliance on costly imports of oil and gas.
"It's just a question of economic competitiveness. It's extremely important to take measures around energy," she said.
Becerril said the EU's other green goals were at risk without a stronger ETS, which she said was "a fundamental tool for stimulating renewables development" and thereby cutting emissions.
Acciona Energy and the other companies that met Barroso on Thursday are all part of the Prince of Wales's EU Corporate Leaders Group on Climate Change.
Sandrine Dixson-Decleve, director of the body, said Thursday's discussion had included other options to prop up the carbon market, such as setting aside up to one billion allowances, as well as the recalibration.
"We had a very frank exchange of views on how we can move from austerity to green growth," she said.
This article was originally published by Reuters. Republished with permission.