Brussels, 26 March 2007
The European Commission today took decisions on the national plans of the Czech Republic and Poland for allocating CO2 emission allowances for the 2008-2012 trading period of the EU Emissions Trading Scheme (EU ETS). It accepted both national plans on condition that a number of changes are made, including a significant reduction in the total number of emission allowances proposed by each Member State. The cleared annual allocation of CO2 allowances is 86.8 million tonnes for the Czech Republic, 14.8% lower than proposed, and 208.5 million tonnes for Poland, 26.7% lower than proposed. The Emissions Trading Scheme ensures that greenhouse gas emissions from the energy and industry sectors covered are cut at least cost to the economy, thus helping the EU and its Member States to meet their emission commitments under the Kyoto Protocol.
Environment Commissioner Stavros Dimas said: “The European Commission has assessed the Czech and Polish allocation plans in the same fair and consistent way as we are assessing all others. Our decisions are based on Member States’ verified emissions in 2005, give credit for projected economic growth and take into account expected improvements in carbon intensity. Today’s decisions are of vital importance to create the necessary scarcity in the European carbon market and make the Emissions Trading Scheme a successful weapon for fighting climate change.”
Assessment of the NAPs
National allocation plans (NAPs) determine for each Member State the 'cap,' or limit, on the total amount of CO2 that installations covered by the EU ETS can emit, and set out how many CO2 emission allowances each plant will receive. Following the Commission's decisions in November 2006, January 2007 and February 2007 (IP/06/1650, IP/07/51, IP/07/136 and IP/07/247), today's decisions on the Czech and Polish national allocation plans, as well as France's (see IP/07/415), bring to 17 the number of NAPsfor the 2008-2012 period already assessed by the Commission.
The Commission's task is to scrutinise Member States' proposed NAPs against 12 allocation criteria listed in the Emissions Trading Directive. The criteria seek, among other things, to ensure that plans are consistent with meeting the EU's and Member States' Kyoto commitments, with actual verified emissions reported in the Commission's annual progress reports and with technological potential to reduce emissions. Other criteria relate to non-discrimination, EU competition and state aid rules, and technical aspects. The Commission may accept a plan in part or in full.
In assessing NAPs, the Commission mainly requires changes where:
Where modifications are required, the Commission has indicated in each case the steps to be taken by each Member State to make the plan acceptable to the Commission. Approval of the plans will become automatic once these changes have been made.
Information about individual decisions
Czech Republic: Plan accepted with changes required.
1) The annual allocation may not exceed 86.8 million allowances.
2) The allocations to installations benefiting from bonuses for early action and co-generation may not exceed expected needs.
3) If guarantees for allocations beyond 2012 foreseen in current Czech law are maintained, the Commission would need to examine them under EU state aid rules. The aid in such guarantees is likely to be found incompatible with the Treaty. Under the Directive the Commission would also disallow the implementation of allocation guarantees when the third allocation plan is assessed.4) More information needs to be provided on how new entrants will be treated.
5) The list of installations has to be completed.
Poland: Plan accepted with changes required.
1) The annual allocation may not exceed 208.5 million allowances.
2) The allocations to installations benefiting from bonuses for early action, biomass and co-generation may not exceed expected needs.
3) More information needs to be provided on how new entrants will be treated.
4) Intended ex-post adjustments must be eliminated.
5) The overall maximum amount of Kyoto project credits which may be used by operators for compliance purposes may not represent an addition to its annual allocation of more than 10 %.
Summary information on the 17 plans assessed to date:
Approved allowances for 2005-2007, verified emissions in 2005, proposed caps for 2008-2012, approved caps for 2008-2012 and additional emissions covered in 2008 to 2012
. Directive 2003/87/EC, as amended by Directive 2004/101/EC.
 These mechanisms are known as the Clean Development Mechanism (CDM), for projects carried out in developing countries, and Joint Implementation, for projects carried out in developed countries or economies in transition.
 The figures indicated in this column comprise emissions in installations that come under the coverage of the scheme in 2008 to 2012 due to an extended scope applied by the Member State and do not include new installations entering the scheme in sectors already covered in the first trading period.
 Including installations which Belgium opted to exclude temporarily from the scheme in 2005
 Additional installations and emissions of over 6 million tonnes are already included as of 2006.
 Verified emissions for 2005 do not include installations which the UK opted to exclude temporarily from the scheme in 2005 but which will be covered in 2008 to 2012 and are estimated to amount to some 30 Mt.
 The sum of verified emissions for 2005 does not include installations which the UK
opted to exclude temporarily from the scheme in 2005 but which will be covered in 2008 to 2012 and are estimated to amount to some 30 Mt.