The European Parliament rejected a plan last week that would have cut the surplus of carbon allowances being traded after opponents claimed it would cause a rise in energy costs. The plan, referred to as "backloading," was proposed to fight the sinking cost of carbon permits, dipping below $6.50 a ton. In an effort to push up prices, the European Commission proposed to withhold around 900 million permits over the next few years, hoping that the scarcity would drive up prices. European energy companies backed the proposal, but high-energy industries said that the low permit price reflected Europe's struggle to recover financially. MEPs voted against the proposal by 334 votes to 315, sending the proposal back to the environment committee for additional consideration. Connie Hedegaard said in a statement that she regretted the rejection. "Europe needs a robust carbon market to meet our climate targets and spur innovation," she said in a statement. "The Commission remains convinced that backloading would help restore confidence in the EU ETS in the short term until we decide on more structural measures." For the full story see