German Economics and Labor Minister Wolfgang Clement has rejected a compromise paper drawn up by experts on the controversial emissions trading system to cut pollution, thus dashing hopes of an agreement between industry and the Greens. Earlier business daily Handelsblatt had reported that officials had agreed that 2,600 energy-intensive companies would reduce their yearly carbon emissions from the current 505 million tons to 499 million tons by 2007. German industry and the Greens have been wrangling over the issue for months. While companies fear a loss of competitiveness and jobs and a rise in costs on account of the emissions trading system, the Greens consider it Germany's moral responsibility to clean up its environment for future generations. The emissions trading system is a cornerstone of the EU's commitment under the Kyoto Protocol to reduce emissions from 1990 levels by 8 percent between 2008 and 2012.