Barclay's said last week that the European Union's plan to extend the Markets in Financial Instruments Directive to cover spot carbon deals will probably encourage trading after thefts and fraud have turned traders away. While some carbon traders are not enthusiastic, "industry didn’t come up with anything better" for problems with the market, said Louis Redshaw, head of carbon, coal, dry freight, and iron ore for Barclays Capital.

The European Union (EU) refused last week to change its airline carbon emissions plan despite opposition from the United Nations aviation body. Starting January 1, the EU will charge foreign and domestic airline carriers for their carbon emissions, and the EU is already defending its decision in court. Last Wednesday, the International Civil Aviation Organization (ICAO) released a declaration with the backing of China, the United States, and 24 other nations saying that the directive was "inconsistent with applicable international law." U.S.

European politicians will renew their debate this week on raising the target for carbon emission cuts as the bloc plans for international climate change talks in Durban. Some politicians and campaigners have said that the minimum target should be a 30 percent reduction by 2020, but earlier this year Poland blocked an attempt to raise the goal to 25 percent. "Already we have a 17.6 percent reduction in 2012," said Jo Leinen, chairman of the European Parliament's environment committee.

The European Union could raise its binding 2020 emissions goals from 20 to 30 percent of 1990 levels much more cheaply and with costs divided much more fairly than originally believed, according to a draft EU document. The financial crisis has virtually guaranteed that the EU will achieve its 20 percent target, according to Reuters, and it also means that a 30 percent reduction would be much more affordable.

Wildlife-rich English grasslands are at risk of being ploughed so that farmers can continue to claim EU subsidies for pastures, experts have warned. To escape penalties under proposed changes to the common agricultural policy, farmers are mowing down high-value grasslands to register permanent pastures ahead of a 2014 deadline. Though many of the grasslands are monocultures with limited natural value, an estimated 100,000 hectares remain that are rich in plants, fungi, bees, moths, and butterflies.

India asked its airlines to boycott the European Union's climate scheme last week, joining China in refusing to comply with the EU's carbon charge plan. "Though the European Union has directed Indian carriers to submit emissions details of their aircraft by March 31, 2012, no Indian carrier is submitting them in view of the position of the government," said Ajit Singh, India's civil aviation minister.

European Union politicians supported a proposal last week to withhold carbon permits from the emissions trading scheme to increase prices. EU parliament's industry committee passed a proposal that would let the Commission take measures that "may include withholding of the necessary amount of allowances" from the 2013-2020 market. Analysts have said that the Commission overestimated the number of required permits for the 2008-2012 period, resulting in a price-depressing surplus of 500 million to 1.4 billion permits.

U.S. climate negotiator Todd Stern and European climate commissioner Connie Hedegaard said that they didn't think that a climate deal at talks in South Africa in December was likely. "There is just this feeling that it's simply not doable for Durban," said Hedegaard after a meeting of the Major Economies Forum. Nations at last year's Cancun meeting agreed to curb the loss of forest, help transfer clean technology to poorer nations, and set a goal to provide $100 billion a year in aid by 2020.

After hearing that the European Union (EU) was set to fall halfway short of its 20% energy efficiency savings by 2020 goal, leaders of the 27 member states overhauled its energy strategy to develop one that may set it on track for 25% carbon dioxide (CO2) emissions cuts by 2020. Currently, the EU as a whole is set to achieve a savings of only 8.9%, less than half its goal, while Germany, Hungary, and Poland will likely fall short by over a third.

The European Union (EU) plans to include maritime transport in emissions trading, in addition to possibly imposing charges on carbon dioxide discharges from ships. Global maritime transport is the source of almost three percent of carbon dioxide discharges, and the International Maritime Organization has failed to agree on measures to curb emissions from ships for more than a decade. Yvon Slingenberg, head of the emissions trading unit at the European Commission, said that the EU will create a "parallel track" to use its own tools to limit maritime pollution.