Carbon Leakage : Europe Compromises Again

The European Parliament, far from closing down Big Carbon, has just agreed a whole raft of exemptions to the Emissions Trading Scheme.

The original plan was to have all Carbon Allowances auctioned as of 2013. That won’t be happening now.

There will be more Carbon Dioxide floating away into the skies. And less revenues from the sale of Carbon Permits to finance Carbon Capture and Storage (which was part of the original plan).

Energy supply and Carbon-intensive industry : protected once again from serious change over Global Warming.

Who, exactly, is responsible for allowing these compromises to get through European legislation ?

Let’s face the dirty truth : money pollutes. Money-making activities pollute the atmosphere. Profit-making organisations have undue influence over policy. Money cannot control Carbon.

What we need is Contraction and Convergence, a system of fair and proportional, contracting allocations of the safety Carbon Budget.




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04.11.09

Industry set for carbon cash-in, as EP environment committee majority agrees on ‘carbon leakage’ sectors

The European Parliament environment committee decided not to object to a proposal by the European Commission, which would lead to serious exemptions for non-power sector industries under the EU emissions trading scheme (ETS) from 2013 on.

A majority of MEPs on the ENVI committee voted against a proposed objection (1) to the draft European Commission decision. The Commission decision qualifies industries accounting for around 77% of emissions outside the power sector under the ETS as being exposed to significant risk of ‘carbon leakage’ – i.e. relocation to other countries where CO2 emissions would rise as a consequence. This makes these sectors eligible for 100% free allocation of emissions allowances from 2013. The decision is now set to enter into force, following the failure of the EP to object.

Green MEP and environment committee member Satu Hassi commented:

“It is seriously regrettable that a majority of MEPs in the environment committee have bowed to the pressure from polluting industries to grant them major exemptions in the EU’s emissions trading scheme. The result – handing out emissions permits to these industries entirely free of charge – flies in the face of the fundamental principle of emissions trading as it either nullifies the carbon price signal on the market or generates windfall profits for the biggest polluters. It also sends a negative message to the UN climate talks ahead of the Copenhagen summit.

“By establishing such an extensive list of sectors deemed to be exposed to significant risk of carbon leakage, the Commission is effectively renouncing the move of moving towards auctioning manufacturing industry allowances in the EU emissions trading scheme. ”

Dutch Green MEP and environment committee member Bas Eickhout added:

“As a concept, carbon leakage assumes that production outside EU is less carbon efficient, which is not always the case. The Commission decision is in clear conflict with the legislation on the ETS. It fails to implement the full criteria stated in the Directive, which require third country commitments and carbon efficiency to be taken into account in the assessment.

“The timing is particularly unfortunate. This long list of sectors to exclude from auctioning has been drawn up under the assumption that no global deal will be reached in Copenhagen. Once again, the EU has failed to improve the chances of concluding an international agreement in Copenhagen that will be consistent with limiting global warming below 2 degrees Celsius.”

Notes to editors:

(1) The proposal to reject the draft Commission decision was rejected in a vote by the EP environment committee with 19 votes in favour, 39 against, 1 abstention.




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