Source: European Commission
Climate Action Commissioner Connie Hedegaard said: “The good news is that emissions declined faster than in previous years even as Europe’s economies started to recover from the recession. However, there is still a growing surplus of emission allowances that risks undermining the orderly functioning of the carbon market. The Commission has taken action to address this with the already adopted back-loading measure. But as this is only a temporary measure, the Commission has proposed to establish a market stability reserve. Now it is up to the European Parliament and the Council to take it forward and move ahead swiftly in their discussions. “
The EU ETS covers more than 12 000 power plants and manufacturing installations in the 28 EU member states, Iceland, Norway and Liechtenstein, as well as emissions from airlines flying between European airports. Last year marked the start of the third ETS trading period (phase 3), which runs until 2020.
Verified emissions of greenhouse gases from stationary installations amounted to 1895 million tonnes of CO2-equivalent in 2013.
Although there are some methodological challenges in assessing with certainty the change in emissions compared to 2012 due to the extension in scope of the EU ETS for the third trading period, estimated emissions in 2013 on a like-for-like basis were at least 3% below the 2012 level for installations in sectors included in both the second and third trading period.
Emissions additionally covered by the EU ETS due to the extension of its scope are estimated at 79 to 100 million tonnes.
Allowances surplus grows
The cumulative surplus in emission allowances increased further to more than 2.1 billion for the 2013 compliance year from almost two billion at the end of 2012. The 2013 figure takes into account the exchange of international credits into allowances, sales of phase 3 allowances to generate funds for the NER 300 programme to support innovative low-carbon technologies, allowances allocated for 2013 and auctioning of phase 3 allowances in 2013.
It is expected that in 2014 the surplus will start to shrink as the implementation of back-loading has started in the first quarter of 2014.