Californian v European model for emission allowances auctions – which of them is better suited to the market
- Category: Auctions of CO2 allowances
Auctions are the pivotal element of the primary market for emissions allowances in the Californian cap-and-trade as well as EUETS. The Auctioning Regulation present in the EUETS (No 1031/2010 of 12 November 2010) seems generally more detailed than the Regulation Order proposed by Air Resources Board. Contrary to the ARB proposal it specifies for instance such details as consequences of late or non-payment etc.
There are many similarities in the auction design and also some differences of technical nature. But several economical and legal assumptions and measures are original in the Californian model for auctions.
Knowledge sharing under NER300 Decision - how to retain the knowledge for yourself (II)
- Category: CCS
It should be stressed that the category of Foreground and, consequently, the requirement of knowledge sharing - comprises the property of the Project Sponsor or every relevant consortium member, supplier or sub-contractor who developed it. All these complex issues need therefore to be carefully considered and precisely specified in all contracts governing the project applying for NER 300 funds.
Knowledge sharing under NER300 Decision - how to retain the knowledge for yourself (I)
- Category: CCS
Licensing requirements in the “Specifications of the Legally Binding Instrument” seem to be a little bit ambiguous. The said provisions should be interpreted separately as regards each of the categories “Relevant Knowledge”, “Foreground” and “Background”. For information defined as “Background” the issue seems to be clear – it is not subject to the knowledge sharing requirements. But the other two categories deserve to be given due consideration.
The Cost Containment Mechanisms in the California Cap-and-Trade Program – why absent in the EUETS?
- Category: Emissions trading
In the European cap-and-trade the cap is established on the volume of allowances and, unfortunately, not on the price. But as the experience shows there are interesting concepts, how to mitigate not only the impact of climate change, but also the price risks inherent in the scheme. Direct quarterly sales of allowances from the Allowance Price Containment Reserve and the fixed Auction Reserve Price cause (providing that the Reserve won’t be prematurely exhausted) that in the California cap-and-trade the regulatory-fixed price range from 10$ to 75$ per metric ton of CO2 can be specified in the perspective 2012 – 2020 (with appropriate modifications in each year of the period).
District heating delivered to private households pursuant to the Benchmark Decision – different tariffs needed
- Category: Implementation
In both of the said models there are decreasing curves of allocation but the main difference (different factors excepting) is that the base for allocation for heat production for private households could be real historical emissions – without using natural gas benchmark.
Benchmarks Decision of the Commission – rules on closures specified
- Category: Implementation
It should be noted that, pursuant to the Decision, an impact on the installation’s allocation of EUAs have, generally, three categories of events:
1) the change to an installation’s capacity (Articles 20 and 21 of the Decision),
2) the change to an installation’s operation (Article 22 of the Decision), and
3) the change to an installation’s activity level (Article 23 of the Decision).