WW200902, Brussels in brief
Revised ETS will boost wind industry
Just before the Christmas break, EU Heads of State and the Parliament adopted the general principle of 100% auctioning of CO₂ allowances in the power sector as part of the revised Emissions Trading System (ETS). The decision was held up as extremely significant by the renewable energy industry: combined with the Renewable Energy Directive with its national 2020 targets, it should give a huge boost to investments in wind and other renewables.
Nonetheless, it was disappointing that the final agreement on CO₂ reductions was a great deal weaker than initially suggested. The goal is to cap total EU industrial emissions at 21% below 2005 levels by 2020 and make an average GHG reduction of 10% by 2020, divided between the Member States, for non-ETS sectors such as agriculture.
The Intergovernmental Panel on Climate Change (IPCC) has stated that to enable the global average temperature increase to be limited to not more than 2°C above pre-industrial levels, emissions in industrialised countries must be reduced by 25% to 40% by 2020.
The EU’s decision allows for at least half of the reduction effort to be met by external credits in non-EU countries, meaning that the domestic reductions Europe is committed to are closer to 8% (and would increase to approximately 12% if an international agreement is reached next year in Copenhagen). This is too far from science to be credible.
The new ETS phase will begin in 2013 and run until 2020.