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Brussels, 25 August 2010
Clean Development Mechanism: European Commissioner for Climate Action, Connie Hedegaard, asks her services to prepare a proposal for a measure to introduce further quality restrictions on the use of credits from industrial gas projects in the post-2012 EU ETS.
Connie Hedegaard, Commissioner for Climate Action said today:
"Europe has been the pioneer of the carbon market and operates the most advanced market world-wide. This has created a major stimulus for international credits generated by the Clean Development Mechanism (CDM). The CDM has been successful in some aspects but has also given rise to criticism, e.g. with regard to environmental integrity. As a first step towards a more advanced carbon market the CDM therefore needs a major overhaul.
In view of the difficult UN negotiations on market mechanisms the European legislator has created ample flexibility for the EU to leverage its role as the leading market for international credits in the climate and energy package.
The international debate has made it quite clear what changes to the CDM are needed (incl. institutional and administrative reform of the Executive Board, geographical balance) and also what successor mechanisms should be put in place to make the carbon market an even more powerful instrument to reduce emissions.
Since taking up office I have been approached by many actors in the carbon market stressing the importance of more clarity on what credits the EU ETS will accept post-2012. While I do understand this desire for more clarity, the business community also understands why Europe needs to preserve valuable leverage for the UN talks.
I strongly believe that it is time for decisions on how to strike the right balance between leverage and clarity. I have asked my services to prepare a proposal for a measure to introduce further quality restrictions on the use of credits from industrial gas projects in the post-2012 EU ETS. At this stage an impact assessment is done to carefully examine the best design of these restrictions.
I invite all interested stakeholders to provide feedback on design aspects of these restrictions".