Share prices of European electricity producers were weak in the last week of April, after a sharp fall in the market price of tradeable carbon emission permits. The market had it right. The smaller the penalty for climate change, the lower the profits of the companies responsible for it.

Regulation that works with market forces rather than against them is a good idea but difficult to implement. When the British electricity industry was privatised, the plan was to create a market that reproduced the efficient system through which the publicly owned Central Electricity Generating Board had ensured that electricity was always supplied from the lowest cost power stations. In practice, it was not possible to do this.