The heatwave that has brought drought to large parts of Europe has helped the price of carbon emissions allowances to record levels, further increasing electricity prices for hard-pressed industry.

Although the carbon price dropped off at the end of last week, to just more than €24 (£16.50) a tonne on Friday, previous days had seen new highs of more than €29. Point Carbon, an analyst company, attributed the easing to profit-taking and some softening in gas prices. More than 9m allowances were traded last week.