The question that is today particularly vital for the CO2 trading community: do elaborations of the ITRE Committee included in the Compromise Amendment No 18 have any direct impact on the current trading conditions with respect to CO2 allowances?
The Compromise Amendment No 18 on Article 19 paragraphs 5, 7, 8 and 9 in the Draft report by Claude Turmes on the proposal for a directive of the European Parliament and of the Council on energy efficiency and repealing Directives 2004/8 (the EED directive - 2011/0172(COD)) includes, inter alia, the following main points with respect to Emissions Trading Scheme:
First: the Commission was obliged to carefully monitor the impact of implementing the EED Directive on Directive 2003/87/EC, Directive 2009/28/EC, Decision No 406/2009/EC as well as Directive 2010/31/EC, and by 30/06/2013 at the latest, come forward with a proposal to adjust the Effort Sharing Decision (No 406/2009/EC);
Secondly: As soon as possible but no later than the date of entry into force of the EED directive, the Commission should present a report to Parliament and Council examining, amongst others, the impacts on incentives for investments in low carbon technologies and the risk of carbon leakage;
Thirdly: what’s most important, the Commission should, if appropriate, amend, before the start of the third phase, the Auctioning Regulation (1031/2010) ‘in order to implement appropriate measures which may include withholding of the necessary amount of allowances’;
Fourthly: the Commission was obliged to carefully monitor the impact of implementing the EED directive on industry sectors, in particular on those that are exposed to a significant risk of carbon leakage. The Commission was, furthermore, obliged to propose, if appropriate, by 31 December 2015, measures to ensure that the provisions of this Directive do not impede the development of these sectors.
Assessing the first of the above-mentioned points against the initial European Commission’s proposition it appears that save the added reference to the Effort Sharing Decision, only the one word (i.e. the word: ‘carefully) has been complemented with respect to the earlier obligation incumbent on the Commission to monitor the impact of implementation of the EED on the directives listed. The three remaining points are, however, entirely new.
Considering the amendments made, the following additional remarks come to mind:
1. The legislative instrument meant to serve the purpose of realising the set-aside of CO2 allowances is Commission Regulation No 1031/2010 of 12 November 2010 on the timing, administration and other aspects of auctioning of greenhouse gas emission allowances pursuant to Directive 2003/87/EC of the European Parliament and of the Council establishing a scheme for greenhouse gas emission allowances trading within the Community (OJ L 302, 18.11.2010, p. 1 as amended);
2. Pursuant to the wording of the analysed legislative proposal the Commission has been obliged to amend the Auctioning Regulation before the start of the third phase ‘if appropriate’ only, but considering all the factual circumstances the EU ETS is currently stuck, the probability of such an assessment is in my judgement high;
3. The concrete legislative measures capable of being utilised by the European Commission have not been specified by the ITRE, thus their potential scope remains open. The sole legal instrument explicitly named is ‘withholding of the necessary amount of allowances’;