ArcelorMittal the world’s largest steelmaker has a carbon permit surplus worth about EUR 1.7 billion (USD 2.4 billion), the largest excess in the European Union’s emissions trading system.

Environmental lobby Sandbag said that ArcelorMittal holds around 97.2 million excess allowances from the period from 2008 to 2010, which can be used in the years ahead. Paris based Lafarge SA (LG), the world’s biggest cement producer, ranks second with a surplus of 29.4 million permits, valued at about EUR 501 million.

The 10 companies with the biggest excesses of allowances, “all of them steel and cement companies, share between them surplus carbon permits of 240 million tons, more than the annual carbon emissions of Austria, Denmark, Portugal and Latvia combined.”

The EU emissions-trading system, the cornerstone of the region’s climate plan, imposes pollution limits on more than 11,000 utilities and manufacturers. Emitters that produce less carbon than their quota can sell surplus allowances. Those that exceed their limits can buy permits in the carbon market.

Sandbag said that “This huge oversupply of permits is threatening to undermine the Emissions Trading Scheme.”

According to Sandbag, while a growing numbers of businesses are calling on the European Union to adopt a stricter carbon reduction goal, a few energy-intensive industries oppose this. The trade associations that the companies with the biggest surplus of permits belong to are some of the most vociferous opponents to progress, the environmental group said.

(Sourced from Bloomberg)