European Union Emission Trading Scheme

The EU Emissions Trading (European Union Emission Trading System, EU ETS ) is a market-based instrument of EU climate policy aiming to reduce greenhouse gas emissions ( such as CO ₂) at the lowest possible economic cost. The aim is to reduce contained in the Kyoto Protocol greenhouse gas emissions in the commitment period 2008-2012 at five percent over the 1990 levels.

The European Union shall periodically set a lower limit for generated greenhouse gas emissions in Europe and distributes a corresponding amount of allowances to the causative industrial companies. The interim trade with the certifications will lead to the reduction of emissions, since it some polluters high emissions imposed higher costs for the purchase of certificates as for action to cut emissions. The sellers are the polluters with below average emissions.

The EU ETS is the first cross -border and world's largest emissions trading. It was decided in 2003 by the European Parliament and the Council of the EU and entered into force on 1 January 2005. The European ETS acts as a pioneer of a possible global system. Currently includes and defines the EU ETS carbon dioxide emissions of about 11,000 plants in 31 European countries (28 EU countries plus Liechtenstein, Iceland and Norway) in power generation as well as some sectors of the industry such as cement factories, which together slightly more than half of the European CO ₂ cause emissions.

Emissions trading is done in multi-year trading periods to compensate for fluctuations as a result of extreme weather conditions ( mild winter, for example, mean lower emissions) and longer- term security of investment to create. So far, the pilot phase I (2005-2007) and Phase II (2008-2012) have been completed.

In the first two phases was determined jointly by the EU Member States, how many emission allowances ( ie greenhouse gas emissions) will total the company provided and under what conditions should this happen. The distribution of emission allowances to the concrete plant was incumbent on the other hand, largely the freedom of nation states. She was laid down in the so-called national allocation plans (NAPs ). In Phase III there will be no more national allocation plans. Instead, the credits are allocated centrally by the European Commission. Responsible for this is the Commissioner for Climate Protection.

• 2.1 Phase I ( 2005-2007)
• 2.2 Phase II ( 2008-2012)
• 2.3 Phase III ( 2013-2020 )
• 2.4 Air Transport
• 2.5 Certificates debate on income and price erosion

• 3.1 Fraud by carousels
• 3.2 Theft of electronic emission

• 4.1 Articles

• 5.1 Official documents and decisions
• 5.2 Government Information pages
• 5.3 Non-governmental organizations, companies and research institutes

Overview

Background and history

The European emissions trading could occur only after a double failure: Originally, the European Commission wanted to introduce a carbon and energy tax in the early 1990s. However, the proposal failed because of the resistance of the Member States, who saw in the introduction to the collection of taxes by the EU, which would have affected a core area of ​​their state sovereignty. The second failure concerns the significant, but ultimately unsuccessful resistance of the EU delegation at the negotiations on the Kyoto Protocol between 1995 and 1997 against an anchoring of emissions trading. Above all, the Americans had insisted to include "flexible mechanisms " in the Kyoto Protocol, which included an emissions trading, and were ultimately so successful. With these developments faced, then walked to the opinion within the Commission, and they began with the conceptual work on the future EU ETS.

The Kyoto Protocol of 1997, the European Union has undertaken the average greenhouse gas emissions to reduce by 2008-2012 at eight percent over the 1990 level to counteract global warming. According to the principle of burden sharing ( burden sharing ), EU Member States have among themselves divided this average reduction target. Here, Germany for example, has pledged to reduce its greenhouse gas emissions by 21 percent, the UK is expected to reduce by 12.5 percent, France stabilized its emissions to 1990 levels, and Spain can increase its emissions even by 15 percent. After a unilateral commitment by the EU emissions are to be reduced by 2020 to 20 percent (in the case of an international convention to 30 percent).

In order to achieve the climate protection target, the EU countries agreed in 2003 under the European Climate Change Programme (ECCP ), among others, the introduction of a cross-border emissions trading as a key element of the climate policy of the European Union.

Legal basis

European legal basis of emissions trading is the adopted on 13 October 2003 Emissions Trading Directive (Directive 2003/87/EC). This Directive had to be transposed by Member States into national law.

In Germany, the Directive has been implemented with the Greenhouse Gas Emissions Trading Act ( TEHG), since 15 July 2004 in force in German law. In it the German Emissions Trading Authority of the Federal Environment Agency with the issuance of certificates and the monitoring of emissions is appointed. The allocation of emission allowances under the NAPs is governed by the laws allocation ZuG 2007 and ZuG 2012.

In Austria, the trade is regulated emission allowances in the emission law.

Operation

The European Emission Trading Scheme ETS works on the principle of cap & trade - limit and act. On the one hand the amount of greenhouse gas emissions is limited, on the other hand, the emission allowances can be traded freely. This is to provide an economic incentive to reduce emissions of harmful greenhouse gases where it is most efficient.

The system is investment based, meaning that each of the currently covered about 11,000 factories and power plants is recorded individually, and not all companies or countries. Each of these operations shall be provided for a specified period, the trading period, a certain amount of emission allowances according to fixed rules ( European Union Allowance, EUA), which takes into account the political set emissions reduction target. An EEA the right to emit one tonne of carbon dioxide (equivalent to 0.27 tonnes of carbon ) or a comparable amount of greenhouse gases with the same global warming potential.

In order to introduce the emissions trading system as possible without economic turmoil, the emission allowances were allocated free of charge initially. If the carbon dioxide emissions of a company is less than the allocated emission allowances, for example as a result of its own emission reductions, the company can sell unused allowances on the market. Alternatively, it may also buy emission allowances, if action is to own emissions would turn more expensive. In this case, another market participant gets money ( in exchange for emission allowances ), to in turn reduce greenhouse gases. The tonne of carbon dioxide saved (1 EUA) so that given a value, which is determined based on market supply and demand. He moved between 2009 and mid-2011 13-17 euros, before he went back to the end of the year at 7 euros. By 2013, the price fell, despite the German nuclear power phase to less than 5 euros per tonne.

As at 30 April each year, the plant operator must provide emission allowances equal to their actual emissions for the previous year. Can not demonstrate the required amount of allowances a company, there must be a penalty of 100 EUR per missing EUA pay and also resubmit a certificate. In the first trading period 2005 to 2007, the penalty was 40 euros.

In order to ensure the functioning of the emissions trading scheme, the amount of emission allowances allocated must be less than the projected emissions. Only way to create pressure on polluters to reduce their emissions. Accordingly, the European Union will increase the number of available emission allowances ( and thus even the emissions) to decrease in the coming years successively.

Scope

The European emissions trading currently includes only a portion of all greenhouse gas emissions and polluters. Involved from the outset, the carbon dioxide emissions from electricity generation in thermal power plants from 20 MW (examples) and from the five industry sectors:

Together, these industries account for about 50 percent of Europe's carbon dioxide emissions and 40 percent of total greenhouse gas emissions of the participating countries. This does not include other greenhouse gases such as methane. In addition, the transport sector ( 24.2 % of GHG emissions in 2007), private households (including services 12.4% ), agriculture (8.6%) and other industries and commercial excluded.

With a volume of over two billion tonnes of CO2, the ETS captures approximately eight percent of all global CO2 emissions. In the future, the system should be extended (for example, air traffic ) on other greenhouse gases (eg nitrous oxide and fully halogenated fluorocarbons ) and polluters.

Trade and technical flow

Although EU emission allowances is mentioned, these do not exist as documents in paper form. Trading takes place in a purely electronic system and via exchanges, brokers or over the counter (OTC), ie directly between the parties. Market participants who want to buy or sell emission allowances must open an electronic account, by means of which the transactions are settled.

There are several marketplaces for emission allowances, such as the European Climate Exchange ( ECX) in London, the European Energy Exchange European Energy Exchange ( EEX) in Leipzig or the Energy Exchange Austria (EXAA ) in Vienna. In Leipzig EEX Carbon Index, short Carbix, as a reference price for emission allowances is. The Carbix is a spot market price, which is determined every trading day at 11.00 clock by auction. The outcome of the auction is usually communicated ten minutes later on the homepage of EEX. A global trading platform, the transatlantic exchange company NYSE € Next to the environment Exchange Blue Next. In 2005 at least 362 million allowances were traded ( tonnes of CO2 ), worth approximately 7.2 billion euros. In 2006, the trade volume increased to one billion in 2007 to 1.6 billion in 2008 to nearly 3.1 billion certificates. On the European trade accounted for about 73 percent of global emission trading, which included a 2008 value of 92.4 billion euros.

The EU emission allowances are restricted compatible with the certificates of the Kyoto Protocol ( Assigned Amount Unit ( AAU), Emission Reduction Units ( ERUs ) from Joint Implementation and Certified Emission Reduction ( CERs) from CDM projects ). Emission rights from other countries, which were acquired under the Clean Development Mechanism, can the ETS under certain conditions, be credited limited (see Phase II). In addition to the ETS, a second emissions trading still takes place: Under the Kyoto Protocol, States may bilaterally negotiate their reduction commitments.

The extent of the emissions of the individual investments is generally determined by detecting the burned fuels. By burning one tonne of hydrocarbons are formed almost three tons of carbon dioxide. This value is slightly higher than that of oil for coal and in turn higher than that of natural gas.

The distribution of allowances will be determined by each country participating in the so-called National Allocation Plans (NAPs). These consist of two components: the macro plan specifies how much emission allowances to be issued to the total investment in a country. It sets out how much the set in the Kyoto Protocol saving by the ETS sector (power generation, refineries, steel production, etc.) and how much by the non- ETS sector (households, other trades, transport, agriculture, etc.) reaches should be. It will be reviewed by the European Commission on the accessibility of the Kyoto goals. Germany had applied for about 482 million annually II Certificates for the current phase, the Commission but this has reduced to 453 million pieces.

In the second part of the NAP, the micro plan, the distribution of the certificates is set to the individual plants. All States have adopted so far primarily on the principle of grandfathering. Thus, the plants receive free allowances in accordance with their past emissions. A small proportion of allowances will also be auctioned in some countries. In addition, many NAPs have special arrangements to reward companies that have set emission reduction measures prior to the introduction of emissions trading (early action). Other exceptions exist in Germany for about combined heat and power and the shutdown of nuclear power plants. The German industrial companies received their initial endowment in Phase II completely free, the power generators but only to 91.2 percent. The remaining 8.8 percent are sold by the state-owned KfW bank group on the stock exchange. Thus about 80 million euros will be made ​​monthly. Also, the micro plan shall be reviewed by the Commission, particularly with respect to the equal treatment of domestic and foreign companies and the compliance with EU competition law.

Economically speaking, is the emission a new scarce resource has been introduced on the market that can be used as a production factor in the production of products or resold on the market. If the Certificates are used in the manufacture of products, the manufacturer will take into account their market prices tend in the calculation as opportunity costs. Even if the climate protection goal is already achieved solely by the capping of emissions, pricing in from the systematic point of view of emissions trading is desirable insofar as amplify the resulting scarcity signals to the consumer the steering effect in terms of efficient implementation of emissions trading. The extent to which a manufacturer emissions trading -related costs can actually pass on to the customer depends on the prevailing market situation. With the introduction of the EU Emissions Trading Scheme in 2005, the electricity price increased in only twelve months to 22 € / MWh. At the same time you register a very high correlation between the allowance price and the current price. Since large parts of the emission allowances were allocated free of charge, this price development brought the German electricity producers in 2005, according to an estimate by the Federation of Industrial Energy and Power Industry so-called windfall profits ( windfall profits ) in the amount of five billion euros. Empirical observations, varying the proportion of opportunity cost, which was passed in Phase I to the consumer, depending on the state, the market structure, demand elasticity and price range between 60 and 100 %.

Criticism of the implementation in Germany

The rules adopted by Germany emission reductions remain significantly behind the commitment under the Kyoto Protocol as well as previous, more extensive reduction targets. The German Ministry for the Environment Trittin originally had a limit of 488 or 480 million tonnes, which provided a reduction by about five percent, but failed these requirements on resistance of the Ministry of Economic Affairs under Wolfgang Clement. After a long and effective media conflict, the ministers have finally agreed to a coalition agreement on 30 March 2004 to limit carbon dioxide emissions and energy industries by 2007 to 503 million tons per year by 2012, 495.5 million tons. This corresponds to a reduction of two percent. In order to achieve the Kyoto target of a maximum of 962 million tonnes of CO2 equivalents to total emissions would have required a reduction of around four percent. The goal can thus be achieved only through additional efforts in other areas.

Furthermore, it is criticized that in the allocation of emission allowances particularly CO2-intensive coal-fired power plants, even new systems, compared to the much more efficient working gas power plants ( CCGT ) is preferred by twice as many CO2 certificates were granted to them, such as gas power plants with the same power, with it proportionally to the previous emission levels but is the same. The political reasons for a preference for gas-fired power plants are the dependence on natural gas imports.

The WWF is in a 2014 study published by the example of selected companies that energy-intensive companies received so many free emission allowances in the past that they achieved through their sale substantial additional profits. It was found that the nine companies studied have received from the industries of iron and steel, refineries, chemical industry and cement since 2005 free certificates to the value of EUR 8 billion. By the end of 2012, these companies had unused allowances, worth in excess of EUR 1 billion - with which they can act freely.

The registered association TheCompensators * advocates for changes in emissions trading and buys as a political character with donations of money allowances from the EU Emissions Trading Scheme, which he can delete it.

Criticism of the implementation in Austria

Austria has committed in the period between 2008 and 2012 to reduce its emissions of CO2 equivalents by 13 percent to 68.8 million tonnes. The objectives established in the EU emissions trading emission reductions are not sufficient to achieve these goals. Due to the dominant electricity from renewable energy sources ( about 60 percent) and the already comparatively efficient industrial plants are the desired savings in these sectors is not feasible. In 2006, the emissions were already 15 percent above baseline. The main reason for the poor figures is the transport sector. Here, greenhouse gas emissions have increased from 1990 until the end of 2009 by 54 percent, although it fell slightly by 0.9 million tons from 2008 to 2009. For the year 2010 is again expected due to the improved economic situation, with an increase in greenhouse gas emissions. The transit was responsible for up to eight million tonnes or 30 percent of the emissions in the transport sector in 2006. Thus, Austria was the end of 2007 to 8.1 million tonnes of CO2 equivalents behind his back obligation, and this despite the mild winter of 2006 CO2 emissions dampened in the field of space heating. Including the emissions added, for the only precaution taken in the form of certificates for low GHG projects, and just missed the target Austria in 2007 by close to 20 million tons. In 2008, Austria was able to reduce greenhouse gas emissions over the previous year marginally by 0.4 million to 86.6 million tons. In 2009, the figure fell to 80.1 million tonnes. In particular, the greenhouse gas output of farms had declined by 14.5 percent due to the financial and economic crisis of original estimates 31.8 million tonnes to 27.3 million tonnes. For the year 2010 is expected to rise in emissions on 2008 levels, given the improved economic situation, however, already again.

In two tranches Austria since 2008 bought 3.5 million CO2 certificates of Latvia, the purchase price remained secret. Total to Austria since the start of emissions trading 45 million certificates have bought each one tonne of CO2 from countries like Spain, Japan, the Netherlands, Estonia, Latvia and the Czech Republic. The average price is given as 9 euros per tonne. In November 2011, the Austrian Environment Minister Nikolaus Berlakovich reckoned with spending of 600 million euros to zuzukaufen missing CO2 allowances from abroad and so to fulfill the international obligations in 2014. In sum Austria is likely to need to pay 1.1 billion euros because of the likely failure to meet climate targets. Around 530 million euro of which attributable to JI / CDM projects in which the country funded climate protection projects abroad and the CO2 savings can be credited for it.

Development of the ETS

Phase I (2005-2007)

In Phase I, the nation states had to give free 95 percent of the certificates. Five percent were auctioned. Only a few Member States took advantage of their freedom. Thus nearly all emission allowances were given away.

Phase I was marked by a massive over-allocation of allowances. A total of about 2,150 million allowances per year were issued. In fact, were only 2.012 million tons (2005), 2,034 million tonnes (2006 ) and 2,050 million tonnes ( 2007) of CO2 would have been emitted from covered installations, so every year over 100 million tons less than by certificates allowed. Specifically, the energy sector received too many emission allowances. Overall, the 15 old EU member states were in Phase I, not less, 4.3 percent more emissions allowances available in the base year 1990. Merely the UK and Germany pledged in Phase I to a CO2 reduction.

After end of April 2006 it was announced that the French company in 2005 almost 12 percent less carbon dioxide emitted than they really should, broke the price of emissions trading certificates from the historical peak of 30 euros to 9.13 euros (see chart). Responsible speak of a " test phase " for the system. The steady decline in the end of 2007 is due to the fact that the certificates could not be carried into the next period. Accordingly, their value tends to zero approaching.

Scientific review

In order to assess and evaluate the success of the ETS can, a simple comparison of certificate allocation and actual emissions is not sufficient. If the emitters of greenhouse gases emission allowances allocated more than this need, which could either be a set too high limit of the certificates ( over-allocation ), but just as well indicate unexpected savings from industry.

Environmental economists from the Massachusetts Institute of Technology will appreciate the reduction of CO2 - equivalent emissions as a result of the establishment of the EU emissions trading scheme in 2005 and 2006 at 50 to 100 million tonnes per year. This would at least correspond to between 2.5 and 5 percent of total emissions in the EU emissions trading sector. The result rather indicates unexpected savings on the part of industry, what a - equals success of emissions trading at this stage - at least small. The researchers point out, however, that some of the underlying data (emissions from 2000 to 2002, which were also used for the preparation of national allocation plans ) are not very reliable because they were made by the industry and under time pressure.

Researchers at the Catholic University of Louvain come to the conclusion that in the area of ​​electricity production in 2005, 88 million tons of carbon dioxide in 2006, about 59 million tons could be saved solely by the EU Emissions Trading Scheme. Germany therefore stands for 35.3 million tons (2005 ) and 27.4 million tons (2006 ) is responsible, which corresponds to approximately 40 percent (or about 47 percent in 2006 ) of the EU-wide emissions. According to the study authors, this is due to the disproportionately high share of electricity from coal-fired power plants, which are particularly affected by emissions trading.

According to calculations by the European Commission (October 2008) were the greenhouse gas emissions of the EU -15 ( ETS and non-ETS sector) in 2006 to 2.7 per cent below the baseline of 1990, even though the economy of these countries over the same period grew by 40 percent. The emissions of the EU -27 fell by 10.8 per cent, therefore, under the Underlying. According to its own forecasts, the EU (see section background and history ) thus reach their own objective expected or even exceed them. At least the recent successes are based on savings off of emissions trading. Finally, the emissions of the ETS sector between 2005 and 2007 have not decreased, but increased by 1.9 percent (see graph ).

Phase II (2008-2012)

The second phase ran from 2008 to 2012 and was thus together with the first commitment period of the Kyoto Protocol, to which the emission targets relate. The 2007 newly joined the EU states Romania and Bulgaria take now as part as the EEA countries, Liechtenstein, Iceland and Norway.

After approval of the 27 national allocation plans by the European Commission since 2008 are only more emission allowances for 2.08 billion tonnes of CO2 per year. This represents only a shortfall of 40 million tonnes of CO2 (-1.9 percent) compared to the emissions in 2005.

In contrast to the first trading period, lack of CO2 emission allowances can be offset by emission reductions in third countries from the so-called Clean Development Mechanism ( CDM) or Joint Implementation projects ( JI). Both mechanisms allow especially developed countries, to a certain degree even outside its own territory redeem their reduction commitments (such as in developing countries), with afforestation projects are excluded. On one hand, they seek to the cost of reducing emissions as low as possible. On the other hand, it should provide for an ecologically sustainable economic development of the transfer of funds and technology to developing countries. The allowable levels of emissions as balanced can set independently of each state; in Germany it was limited to 22 percent of each individual investment allowances allocated.

In addition, some more equipment are expensed as in the first period, about crackers in chemical plants ( a total of 52 million tons per year).

With regard to the allocation of allowances, the countries in their NAPs more freedom: you can auction up to ten percent of their allowances. Germany currently sold 8.8 percent of the certificates on the exchange. This is handled by the state-owned KfW bank group.

Phase III (2013-2020)

With the third trading phase adopted by the EU on 23 April 2009 it came to the award of certificates to substantial changes. There are no more national allocation plans, instead gives the European Commission the EU-wide overall cap on CO2 emissions ago. This is in 2013, only 2.04 billion tonnes of CO2. The amount annually - starting with 2014 - decreased by 1.74 percent. This reduction can be continued beyond 2020, but to check the latest 2025 and adjusted if necessary. Furthermore, there are CO2 emission limits for the manufacture of individual products (so-called benchmarks). For example, may be emitted from the production of cement per kilogram maximum of 766 grams of CO2 per kilo of steel and 1328 grams; for beyond this amount of CO2 emission allowances must be purchased.

The number of climate- active substances included in the trading system has been increased. For example, nitrous oxide and fully halogenated hydrocarbons are included in the emissions trading scheme. However, there are exemptions for energy-intensive and export-oriented companies.

While in the first and second phase of emission allowances were distributed mostly free, they are now increasingly awarded through auction. 2013, the share of auctioned allowances 20 percent (previously up to ten percent). In the following years the proportion is increased step by step up to 70 percent (2020 ) and finally 100 percent ( 2027 ). According original Commission proposal in 2020, all allowances should already be auctioned. Council of the EU, however, finally prevailed with the less ambitious goal. The power producer must already pay from 2013 all the required certificates, the exception of - especially in Eastern Europe - Member States whose power plants have a relatively high share of coal. The operators of these plants receive at the beginning still free up to 70 percent of the certificates, but they must also bid no later than 2020 in its entirety.

In addition, there will be a revision of the allocation of free emission. Those certificates that remain free of charge will be awarded in the future no longer under the grandfathering ( the orientation of historical emissions from the plant ), but according to the principle of best available technology ( best available technology, BAT, orientation to the technical standard of the asset class ). A steel plant about to be no longer then allocated allowances, how much CO2 it has been ejected, but measured on the scale, what is the output of a modern and efficient steel plant of the same order. Starting point for the definition of benchmarks, the average performance of the ten percent efficient installations in a sector or sub- sector in the Community in the years 2007 and 2008. Benchmarks are then determined for each product and take into account the " most efficient techniques, substitutes, alternative production processes, highly efficient combined heat and power, efficient energy recovery of waste gases, use of biomass and capture and storage of CO2, where such facilities are available. "Those energy-intensive farms, which are among the most environmentally friendly ten percent of their trade in Europe, are rewarded with free emission allowances.

Also free of charge are allowances for industrial companies whose production costs would rise due to CO2 taxes by more than five percent and redeem their sales to more than ten percent in export outside the EU or if one of these two criteria is 30 percent. This is intended to competitive disadvantages compared to competitors can be prevented that operate in states that do not participate in the global climate. Which sectors in the future of this so-called " carbon leakage " benefit, is determined up to 31 December 2009 by the EU Commission and then revised every five years.

The revenues of a high double-digit billion euro range will be distributed partly to the Member States, feed a climate fund in part. Rich EU countries have to give 12 percent of their rightful allowances to poorer countries to mitigate their costs due to emissions trading. In detail provided for auctioning emission allowances as follows are distributed to the Member States:

• 88 percent go to the Member States in accordance with their emission shares in 2005.
• 10 percent will be distributed according to the Commission (Annex 2) redistribution proposal to 19 poorer or low growth Member States.
• 2 percent goes to those nine new EU Member States whose greenhouse gas emissions between 1990 and 2005 decreased by 20 percent. Romania will receive them a share of 29 percent, Poland 27 percent and 15 percent of Bulgaria.

Traffic

On 20 December 2007, the EU Environment Ministers agreed to include aviation in the EU emissions trading scheme from 2012. This should all airlines taking off or landing in the EU who buy in the future regardless of source emission - also for intercontinental flights. For the grown since 1990 by 87 per cent CO2 emissions of air transport should be reduced. The price of a ticket for a return flight within the EU will be more expensive by up to nine euros, according to a study by the European Commission. For long -haul flights could be expected price increases of up to 40 euros.

In contrast to the industrial and power companies, there is no NAPs for air traffic. Instead, the certificates will be distributed directly by the Commission. In addition, not more than ten, but 15 percent of the allowances will be auctioned and the free distribution does not follow grandfathering rules, but on the basis of a technological benchmarks ( best available technology, BAT). Thus, numerous of the European Commission's proposals for Phase III already anticipated ( see previous section ).

The European Parliament had occurred in the negotiations as an advocate of stricter rules. Thus, the air traffic should be included as early as 2011, allocated fewer allowances and, in addition, a greater proportion (ie, 25 percent) will be auctioned.

Non-EU states were then from the inclusion of "their" airlines in the EU Emissions Trading Scheme. India, Russia, the United States and the People's Republic of China banned partially their airlines to submit to the rules; as the People's Republic of China forbade registered in their country airlines to spend money for the certificates. Opponents criticize the project, the EU thus overstepping its competence, especially as the tax should be based on the length of the flight and not only on the distance across the EU Member States route. However, the ECJ approved in a judgment of 21 December 2011, the EU's approach and dismissed claims by U.S. carriers back.

On 12 November 2012, the European Commission imposed the obligation of the release of greenhouse gas emission allowances for flights over EU borders for a year until the conference of the International Civil Aviation Organization ICAO 2013. Since then, only flights within the EU will be covered by the ETS, or about 40 percent of all start from or landing in the EU flights.

In October 2013, the ICAO agreed on a roadmap to a global climate change agreement in air transport. By 2016, it wants to develop a market-based system to limit emissions, which should come into force in 2020. Based on the level then reached to aviation emissions from now on only CO2-neutral growth. The U.S. and the major emerging economies prevailed, however, that States undertake not to be binding. In addition, there should be relief for developing countries and countries with difficult economic situation. Include flights between the EU and non-EU airports in the EU Emissions Trading rejected the ICAO Assembly. Was rejected and the EU compromise proposal, only flown over Europe kilometers to consider ( " air space " approach ).

Debate on certificates surplus and price erosion

On 20 December 2011, the non- lead in the relevant proceedings Environment Committee of the European Parliament adopted in the context of consultations on the Energy Efficiency Directive a decision authorizing the Commission could hold back at the start of the third trading period in 2013 more total 1.4 billion emissions trading certificates (set aside ) to support the unexpectedly low price of 7,40 €. The amount of reduction would represent more than three times the amount required by the German industry per year.

According to the Ifo Institute in February 2012, the Renewable Energy Sources Act ( EEG) valley in Germany the price of emission allowances trading in Europe. At the lower price could find these certificates in other EU countries, sales and enabled there the emission of as much additional CO2 as would be saved in Germany by the EEG. The coal and gas power plants would then have just in Poland or Italy, while solar plants in Extremadura would be prevented. The collision with the EEG of the EU emissions trading could therefore his duty to reduce emissions at the lowest possible economic costs that do not meet.

On July 25, 2012, the European Commission proposed a decision before amending Directive 2003/87/EC, which provides that the Commission " any time when necessary " may adjust the schedule for the auction of emission rights "to ensure the proper functioning of the market ". The Lead Environment Committee of the European Parliament decided on February 19, 2013 amendments to this proposal, which amount that the Commission can make such a change only once and under certain conditions.

The Environment Committee of the European Parliament spoke out in February 2013 for the Commission's proposal to take 900 million emission allowances out of the market. However, this plan must agree to the House of Parliament and the Member States. In this way, the decision, the number of emission allowances to be closed down will significantly reduce. However doubt different climate experts a permanent noticeable effect on the price of allowances and to raise the climate target ( 30% instead of 20 % CO2 reduction by 2020) so as to reanimate emissions trading.

In parallel to its proposal to amend the Directive, the European Commission presented a draft amendment to the Auctioning Regulation No. 1031/2010, therefore a total of 900 million allowances are to be brought less to the market in the years 2013-2015, in the years 2019 and 2020 will be auctioned separately.

EU Commissioner Günther Oettinger said in a plenary of the European Parliament for the Energy Efficiency Directive on 11 September in Strasbourg on the idea " if you permanently do not even exist on the path to 2020 levels in the market, ie practically a shortage of emission rights as a whole and not just a delay in the supply market provides. "

The German Federal Environment Agency is pushing for stronger incentives for climate protection through emissions trading and a corresponding adjustment to the certificates budgets. Just as there is for the energy sector and industry enough incentive to invest more in climate protection. Overall, the European climate target of 20 percent would have to be increased to 30 percent. Was also of concern that the emissions increase from the transport sector, which are not included in emissions trading.

German Watch issued in February 2013 along with six large companies an appeal to the Federal Government to repair the EU emissions trading scheme. This call for Alstom, EnBW, E.ON, Otto, Puma, Shell and German Watch more security for climate investments of the economy. For this, the federal government must now support the EU Commission to reform the emissions trading proposals. Also, a survey conducted by the institute TNS Emnid was published showing that there is 73 percent of Germans say that the EU raises its emission target for 2020 from the low 20 to 30 percent below the 1990 level. Also ¾ of respondents want Chancellor Angela Merkel now personally turns into intense negotiations with the Polish government to achieve the 30 percent goal. Poland is currently the main blocker higher climate goals. Also, the Federal Association for Renewable Energy appealed several times to revive the European emissions trading, in order to create more level playing field for renewable energy.

According to the German Institute for Economic Research ( DIW) from March 2013 had accumulated a large surplus of allowances in recent years. The reasons for this are " especially unexpected reductions in emissions due to the economic crisis and a strong inflow of international carbon credits ". According to estimates of the Institute of the accumulated surplus could rise to 2.6 billion tons by 2015. Thus, the emissions trading to meet its regulatory effect, the surplus of allowances should be permanently dismantled. An analysis of the Institute show that a part of the surplus can be absorbed through the hedging demand from power producers. The remaining surplus could be reduced by the proposed by the EU Commission displacement of certificate auctions ( backloading ) within the current trading period. At the same time, a consultation process for a structural reform of the Emissions Trading Scheme has been launched. Through these measures, the EU emissions trading could his role again meet. Otherwise, the credibility of the European climate policy is at stake.

Also, the "Annual Report energy consumption in Germany in 2013, " the AG energy balances concludes that "the intent of the emissions trading incentives for emission-reducing behavior in such certificate prices [ of about 5 euros / ton ] not expected " were.

The current price developments in the EU emissions trading favors opinion of the Agency for Renewable Energies in June 2013, electricity generation from coal to loads flexible gas power plants. The be contrary to the EU's climate and energy policy objectives and the German government. Given low CO2 prices, the deteriorating competitiveness of natural gas compared to coal power plants and the utilization of gas-fired power plants take off.

On 3 July 2013, the European Parliament voted for a shortage of allowances in order to prevent further deterioration of prices of the Certificates. Following a proposal from the European Commission, the oversupply of around two billion allowances from 2013 to 2015 should be reduced by 900 million. Pollution rights, which should be released only in the years 2019 and 2020 according to original plans, should it come to market as early as 2016.

On 8 November 2013, the Permanent Representatives of the EU Member States were in favor of a proposal to backloading, which provides that 900 million allowances will be taken out of current auctioning to feed this back to 2019.

Fraud in connection with the EU Emissions Trading

Carousel fraud by businesses

In connection with the EU emissions trading scheme it came carousels to so-called 2008 and 2009. Emission rights have been several times over EU borders sold in a fraudulent system of time and then to subject the VAT refunded unlawfully by the tax office to the dealer. The applicable for intra - and international trade in the EU specificities and different deadlines for the payment and refund of value- added tax and are exploited. The European police agency Europol informed in December 2009 that in some countries up to 90 % of the volume in the market for pollution rights could result from fraud. The EU countries UK, France, Denmark, the Netherlands, Spain and Germany was by the control loss already in a financial loss of 5 billion euros incurred. The total damage in Germany amounts to 850 million euros, according to the Attorney General's office in Frankfurt. As a first consequence of the VAT has been exposed to carbon credits in the UK and France; in the Netherlands and Spain, the tax liability for sales was transferred from the seller to the buyer in the reverse charge procedure. The law for the implementation of European law it will come from 1 July 2010 in Germany to reverse charge mechanism in trade with emission certificates.

The system, which use the scammers to swindle taxpayers' money, has nothing to do with emissions trading itself and thus has no direct consequences for climate protection. Nevertheless, warned Rob Wainwright, Director of Europol, these criminal activities would jeopardize the credibility of the EU emissions trading scheme. The former French Economy Minister Christine Lagarde urged to submit the emissions trading an appropriate capital market supervision.

Theft of electronic emission

On 20 January 2011 it was announced that unknown hackers have stolen up to two million allowances worth 28 million euros. The EU Commission then (about a fifth of the total market activity ) exposed to the entire spot - pollution trading until further notice. Remain only the allocation and assignment of pollution permits allowed. Previously the Paris CO2 exchange BlueNext and the registries of the affected countries Czech Republic, Greece, Estonia, Poland and Austria had ceased operations. In the Czech Republic, according to a market participant 470,000 EUAs were stolen valued at 6.7 million euros. In Austria, the damage amounts according to the Federal Police Headquarters in Vienna 7.5 million euros. It is the largest incident in European trading pollution rights.

On 4 February 2011, the EU ETS was restarted. The European Commission announced that the national trade register of Germany, France, the Netherlands, Slovakia and the United Kingdom resumed their operation. The five States had informed the Commission previously demonstrated that their national trading systems meet all necessary safety requirements.

Experts blame for the incident, the lax safety regulations of individual countries. To query the identity was deficient. Throughout Europe, according to European Commission 14 countries suspected not to satisfy the security requirements. The Director-General for Climate Protection, Jos Delbeke announced plans to interview all Member States regarding their security precautions to protect against hacker attacks and theft. The head of the German Emissions Trading Authority (DEHSt ), Hans -Jürgen Nantke, called for a harmonization of European safety standards. The end of November 2010, there were 1.6 million certificates disappeared in Romania.