EU Environment Agency: Emissions Trading system should be tougher and more diverse

More companies should be brought within the European Union's emissions trading scheme from 2008, the EU Environment Agency urged in a report issued today ( "Using the Market for Cost-Effective Environmental Policy",).
Hence, "Emissions trading works better if the number and diversity of sources under the [scheme] is larger, and if technological requirements for individual sources [of emissions] are less stringent," the European Environment Agency (EEA) says. But, tougher policies - with "bite" - succeed in achieving their environmental goals. Business groups have argued against tougher regulation on the grounds that it damaged competitiveness. But the EEA dismissed such claims: "There is no evidence that existing economic instruments [such as emissions trading, environmental taxes and liability schemes] have a major adverse effect on competitiveness at the macro and sector level."