EU member countries have voted to approve updated benchmarks determining the distribution of free pollution allowances under the Emissions Trading System, according to diplomats from three separate countries.
The positive vote Monday was a compromise with the European Commission, which pledged in return to review its benchmark methodology and provide more free allowances to industry in its hotly anticipated review of the ETS due in mid-July.
The benchmarks determine how many free carbon allowances various sectors receive and are calculated based on the 10 percent best polluters, per industry, in a bid to incentivize businesses to go greener. Companies consider them crucial to gauging their annual profitability.
After the European Commission first proposed the updated benchmarks in May, member countries and heavy industries immediately criticized the method by which the Commission came to its numbers.
