Benchmark EU carbon price hits record high of 55.47 euros/tonne

LONDON (Reuters) - The benchmark European carbon price hit 55.47 euros a tonne on Wednesday, its highest level since the European Union’s carbon market launched in 2005.

The contract had fallen back to 54.83 euros by the time of the market’s close at 1600 GMT, but this was 3.4% up on Tuesday’s close.

The EU’s Emissions Trading System is the bloc’s main tool for curbing greenhouse gas emissions that cause climate change, forcing power plants, industry and airlines running flights within Europe to buy permits when they pollute.

The benchmark - the December 2021 carbon contract - has risen around 60% since a December meeting when EU leaders agreed a more ambitious target on emissions cuts this decade.

EU climate chief Frans Timmermans said last week, when prices hit 50 euros, that prices should be higher still and that intervening in the market in response to the price rally would be unwise.

Reporting By Susanna Twidale. Editing by Jane Merriman