Carbon leakage list: additions possible, no removals
- Category: Implementation
EU ETS carbon leakage list applies for the years 2013-2014. It is interesting that while additions are possible before 2014 (and are in fact occuring in yearly intervals), sectors included cannot be removed from the list before that date.
Such carbon leakage list unidirectional design is in the climate policies turmoil among the last safeguards that give certainty to the European industry.
Capacity market's MiFID/EMIR treatment
- Category: Capacity Markets
Limited powers for intervention on the carbon market granted to the European Commission on 3 July 2013
- Category: Legal Alert
The European Parliament's files documenting backloading vote in the plenary on the 3 July 2013 show the European legislative body decided to rein in the executive's ambitions to influence carbon market in the administrative way.
UK capacity market in the light of EC State aid requirements
- Category: Capacity Markets
The intended UK capacity market, the major milestones thereof have been recently revealed, appears to reflect the key points of the European Commission' recent consultation on State aid criteria to be applied to capacity mechanisms.
California Allowance Price Containment Reserve not so interesting for traders
- Category: Emissions trading
Market forces have verified legal assumptions for the creation of the California Allowance Price Containment Reserve (APCR). Subsequent sales from this vehicle do not attract any participants. Does this mean that the Reserve works as initially predicted or something has failed?
Will the second carbon leakage list be used to intervene in the market?
- Category: Emissions trading
There are doubts regarding the necessity to verify carbon leakage list merely two years after its adoption. It seems that this period is too short to assess whether there are serious threats to the competitiveness of branches covered by the actual list. Moreover, the current level of carbon prices makes all assessments strictly hypothetical and vulnerable to change. Nevertheless, given legal obligation imposed, the verification is inevitable. The significant report likely to influence future decisions on the issue is now available.
Details for the CERs and ERUs conversion process specified in the new EU emissions registry regulation
- Category: CER, ERU
The salient qualitative difference as regards CERs and ERUs use in the EU ETS third trading period, as compared to the years 2008-2012, is that as from 2013 CERs and ERUs no longer are compliance units within the EUETS but are exchangeable with EUAs. The modalities for this exchangeability pursuant to the Article 11a of the EU ETS Directive are quite differentiated.
Standard imbalance and connection charges to be borne by renewable sources under the new draft GBER Regulation
- Category: Energy market
Acknowledging a patchwork of existing European renewable promotion schemes may provide to the contrary, the requirements proposed in the latest version of the draft GBER Regulation propose that if a renewable electricity is supplied to the grid, the producers or where relevant aggregators should be subject to standard obligations regarding network connection and network connection charges and should bear responsibility, in financial terms, for all deviations (imbalances) between their scheduled and actual generation within a given imbalance settlement period. The said responsibility can be outsourced to other balance responsible parties, subject to commercial arrangements.
The key issue is also that the State aid to electricity generation from non-renewable sources and to energy infrastructures will not be exempt from the EC notification 'in view of their high distortive potential impact on the internal energy market.' Such investments will have to be notified to the European Commission to assess their compatibility with the internal market.
Public disclosure interlinkages between Electricity Market Transparency Regulation, Regulation No 714/2009 and REMIT
- Category: REMIT
Relation of the Electricity Market Transparency Regulation to the Regulation No 714/2009 and REMIT may rise some doubts as all the regulations mentioned lay down specific requirements on publishing data on the availability of networks, capacities of cross-border interconnectors and generation, load and network outages.
NC RfG and DCC - astonishing divergences in derogation procedures
- Category: Energy market
It is probable that legislative efforts to elaborate on the two fundamental Internal Electricity Market network codes:
1) Network Code for Requirements for Grid Connection Applicable to all Generators (NC RfG), and
2) Network Code on Demand Connection (DCC)
will effect in the coming months in the adoption of regulations with European-wide binding force.
It merits noticing that both network codes impose sometimes strict technical and legal requirements on, respectively, Power Generating Modules and Demand Facilities.
Some jurisdictional issues regarding California and Quebec ETS linking
- Category: Emissions trading
It is highly probable that effective January 1, 2014, covered California or opt-in entities will have the possibility to use compliance instruments issued by the Government of Quebec to meet their compliance obligation.
However, linking may provide some regulatory mess as to which jurisdiction applies to entities trading in both: Quebec and California emission allowances.
Why EU ETS does not apply auction purchase limit and holding limit
- Category: Implementation
Although applying holding limits as well as auction purchase limits in cap-and-trade schemes sometimes meet with criticism, the absence of such limits in the EU ETS current design, particularly when the concept of backloading failed, brings important risks for the system.