EU industrial plants pumped out 1.785 billion tonnes of CO2 greenhouse gases into the atmosphere in 2005 while national authorities had given them allowances for 1.829 billion tonnes, data from the European Commission showed.

Environmental groups seized on the permit figures as evidence that EU governments had attributed too many allowances to companies and undermined the programme, which is supposed to be the flagship of EU efforts to cut greenhouse gases under the Kyoto Protocol.

"European governments have blatantly ignored the aims behind the (emissions trading scheme) and abused the trading scheme, under pressure from their dirty industries," said the European director of the Climate Action Network, Matthias Duwe.

Figures for Cyprus, Luxembourg, Malta and Poland were not included because the data had not yet been sent to Brussels.

The commission said the data was good news for the environment and refused to speculate that the gaping discrepancy between quotas and real pollution was due to governments being too generous in handing out quotas.

"The fact that the emissions in this report are lower than expected is in principle good news for us and the environment," said commission spokeswoman Barbara Helfferich.

While not ruling out over-allocation as being behind the gap, the commission official in charge of the dossier, Artur Runge-Metzger, said it could be due to increased fuel efficiency or lower energy demand because of high prices.

The quotas are the cornerstone of the EU's landmark emissions trading scheme which was launched at the beginning of 2005.

In Paris on Monday, French Industry Minister Francois Loos said that France and Germany would ask the EU Commission to modify the system amid fears that the cost of permits could translate into higher electricity costs for consumers.

Loos said he would present a plan to the commission to change the French permit allocation system, allowing France to distribute more CO2 permits in the event of what the minister termed a "speculative bubble" affecting the market price.

The EU market, the world's biggest for trading in greenhouse gases quotas, has fallen sharply in recent weeks on emerging evidence that member states had issued more quotas than needed.

In late April, the market fell 35 percent in a single day to 15 euros for a tonne of CO2 emissions after the publication of figures from the Belgium, the Czech Republic, Estonia, France, the Netherlands and Spain.

By Friday the price had tumbled to 9.25 euros on the European Climate Exchange after the commission's data were leaked into the market.

In midday trading on Monday, the price for the right to pump one tonne CO2 into the atmosphere was back up to 13 euros.

British Environment Minister Ian Pearson was also suspicious that some member states had not been realistic in the way they had handed out emissions quotas.

"While the system appears to be functioning effectively, the results across the EU do raise questions about the stringency of the caps in some member states," he said.

Member states are likely to pore over the figures in the coming weeks as they prepare to inform Brussels before the end of June of how many allowances they plan on giving companies for the period running from 2008 to 2012.

Analyst Henrik Hasselknippe at research group Point Carbon said: "Those of us working in this market need to sit down and analyze the data to see to what extent is this an over-allocation and to what extent it is a matter of actual reductions."

Under the scheme, more than 9,400 industrial plants were attributed CO2 emission quotas with one allowance giving the right to emit one tonne.

The aim of emissions trading systems is to generate incentives for companies to reduce their emissions and impose costs on those that are less efficient.

Plants that emit less than their quota allows, for example by investing in green technology, can sell the surplus allowance on the emissions market to companies that pollute more.

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