Energy firms fear "tremendous decline" in CO2 price

The Europe Union's carbon market could be flooded with excess pollution permits over the next decade, deflating prices and undermining investment in green energy, five EU energy companies warned on Tuesday.

The utilities, including Britain's Scottish and Southern Energy and Denmark's Dong, said falling carbon prices could: "severely hamper business incentives to invest in low-carbon technologies."

One leaked study seen by Reuters foresees carbon prices falling to 14 euros per tonne, compared with a business-as-usual price of 25 euros. Another sees the price dropping to zero.

STV