The European system for putting a price on carbon emissions is gaining wider acceptance and is making a small dent in the amount big energy companies are polluting, according to a survey of more than 2,500 companies released Tuesday.
But the reductions were only marginal, and the cap and trade program adopted six years ago will only begin to bite when it enters its next period in 2013, analysts said.
Under the cap-and-trade system, about 12,000 companies are allocated permits that limit how much greenhouse gases they can emit. Companies that exceed their allocations can buy credits from companies that have emitted less than allowed.
Last year, the trade amounted to $123 billion, said Point Carbon, a private firm that conducted the survey.
The survey included hundreds of European power companies and heavy industries, and showed that 59 percent of those that responded already have reduced their emissions because of the system, up from 54 percent last year. Another 9 percent said they plan to lower emissions because of the cost of carbon.
But most of the reductions were marginal, often less than 5 percent over the last two years.
"We are seeing incremental changes, not revolutionary changes," said Endre Tvinnereim, a senior analyst.
Power companies have been receiving their permits for free, but starting in 2013 they will have to pay for their allocations in an auction with other companies.
Despite a small increase in emissions last year as economies recovered from recession, overall carbon pollution has declined since 2005 and Europe was on target to meet its goal of slashing emissions 20 percent by 2020 from 1990 levels.
A similar cap and trade program was a cornerstone of President Barack Obama's policy on climate change, but failed to win congressional support. However, several regional trading schemes have been approved among U.S. states, most recently in California, and within five years carbon trading is expected to be established in China, Australia, Brazil and others among the world's largest polluters.
The survey, conducted Jan. 27-Feb. 14, showed 49 percent of the 2,535 companies that responded thought the trading scheme was the most cost-effective way for Europe to meet its emissions targets, up from 43 percent the previous year.
Tvinnereim said the growing level of confidence was a surprise after the discovery in January of the cybertheft of about $50 million in carbon credits stored in the registry of the Czech Republic. The credits were moved to an account in Poland, then to Estonia and Lichtenstein. After that they disappeared and presumably were sold to unsuspecting buyers.
"There was talk about the EU ETS (Emissions Trading Scheme) having been discredited. However, our survey shows quite the reverse," the analyst said.