Green Europe Falters in Debt Crisis

Carbon price drop discourages investments in renewable energy.

The European sovereign debt crisis that’s spread from Greece to Italy and is roiling the region’s banks now has another potential victim: energy policy.

European Union emission permits, needed by polluters from utilities to cement makers for each ton of the carbon dioxide they put in the atmosphere, slumped to their lowest price in 2 1/2 years on Oct 4. An auction of permits by Greece, trying to avoid the euro area’s first default, worsened a glut of the allowances, UBS AG analyst Per Lekander said last week.

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