Annexes to COM(2014)689 - Progress towards achieving the Kyoto and EU 2020 objectives - Main contents
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This page contains a limited version of this dossier in the EU Monitor.
| dossier | COM(2014)689 - Progress towards achieving the Kyoto and EU 2020 objectives. |
|---|---|
| document | COM(2014)689  |
| date | October 28, 2014 |
5.1.2. EU ETS
Work on implementation has led to the successful start of phase 3 under the EU ETS (period 2013-2020). In terms of scope, the ETS now covers, in addition to CO2 from most of industrial installations, nitrous oxide (N20) from the production of nitric and other acids and PFCs from the production of aluminium.
The EU ETS phase 3 does no longer provide an individual cap for every Member State, but a single cap for the EU, Iceland, Liechtenstein and Norway. As of 2013, around 43 % (excluding NER 300[22]) of the emission allowances have been auctioned, and this share is expected to increase over time.
Since 2009, a growing surplus of allowances and international credits has been available on the carbon market, leading to a fall of the carbon price. To address this imbalance, the Commission proposed to postpone ('back-load') the auctioning of 900 million allowances from the early years of phase 3 of the EU ETS to the end of the trading period. The 'back-loading' was adopted by amending the Auctioning Regulation on 25 February 2014.
On 22 January 2014, the Commission furthermore adopted a legislative proposal to establish a market stability reserve at the beginning of the fourth trading period in 2021. The proposed reserve will complement the existing rules. Allowances are placed in the market stability reserve – i.e. deducted from future auction volumes – according to the "total number of allowances in circulation". The flow of allowances into and out of the reserve would occur on the basis of an automatic, fully rule-based process.
In the aviation sector, the International Civil Aviation Organization (ICAO) Assembly agreed in autumn 2013 to adopt a definitive agenda leading to a global agreement to tackle aviation emissions. Pending the possible adoption of international rules, the Council and European Parliament limited in March 2014 the coverage of the EU ETS to flights within the European Economic Area for the period from 2013 to 2016.
5.1.3. Other policies and measures
The Commission adopted a Communication[23] setting out a strategy for progressively including GHG from maritime transport in the EU's policy for reducing its overall GHG emissions. As a first step in implementing this strategy, the Commission proposed a Regulation which would establish an EU-wide system for the monitoring, reporting and verification of CO2 emissions from large ships starting in 2018. The draft Regulation is under consideration of the Parliament and the Council.
Implementation of the legislation setting targets for CO2 emissions from cars[24] to 2021 and from light commercial vehicles[25] to 2020, is complete. The Commission has approved six eco-innovations which reduce CO2 emissions.
A new legislation[26] on fluorinated greenhouse gases has been adopted and will apply as from 1st January 2015. It will reduce fluorinated gases emissions by two-thirds in the period from 2015 to 2030 entailing a total cumulative savings estimated at 1.5 Gt CO2 eq. until 2030, and 5 Gt CO2 eq. until 2050, compared to a business-as-usual scenario.
In order to mitigate against the indirect land use change emissions from biofuel production, the Commission proposed a number of amendments to the Renewable Energy and Fuel Quality Directives ('the ILUC proposal'). The proposed text is currently discussed within the European Institutions.
Member States have begun the reporting, under legislation adopted in 2013[27], on their current and future LULUCF actions to limit or reduce emissions and maintain or increase removals in that sector.
A list of legal acts recently adopted is available in section 3 of the accompanying SWD.
5.2. Adaptation to climate change
On 16 April 2013, the Commission adopted the EU Strategy on Adaptation to Climate Change aiming at contributing to a more climate resilient Europe. It focuses on meeting three key objectives with the following main developments:
· Promoting action by Member States: The Commission encourages Member States to adopt comprehensive adaptation strategies and is developing an adaptation preparedness scoreboard. In March 2014, the European Commission launched the Covenant of Mayors Initiative encouraging cities to take action to adapt to climate change. Mayors Adapt aims at increasing the support for local activities, providing a platform for greater engagement and networking by cities, and raising public awareness about adaptation and the measures that are needed. The Commission also supports adaptation projects, in particular through the new LIFE Climate action sub-programme.
· Mainstreaming adaptation action into EU policies: the objective to devote at least 20 % of the budget of the Union for climate change related objectives is used as a tool for promoting adaptation.
· Promoting better informed decision-making, in particular through the Climate-ADAPT platform, which enables collecting and disseminating adaptation information in the EU. The Commission is furthermore completing a knowledge gap strategy on adaptation aiming at identifying and bridging specific sectorial knowledge gaps.
5.3. Climate Finance
5.3.1. Auctioning revenues
5.3.1.1. Use of auctioning revenues by Member States
Under the Monitoring Mechanism Regulation, Member States were requested to report for the first time by 31 July 2014 on the amounts and use of the revenues generated by the auctioning of ETS allowances in the year 2013 (see Figure 9 and in Annex as well as more detailed information in SWD). The total revenues for the EU were € 3.6 billion.
The EU ETS Directive provides that at least 50 % of auctioning revenues or the equivalent in financial value of these revenues should be used by Member States for climate and energy related purposes. All Member States have reported to have used or to plan to use[28] 50 % or more of these revenues or the equivalent in financial value of these revenues for climate and energy related purposes[29] (87 % on average representing approximately € 3 billion), largely to support domestic investments in climate and energy.
The reported amounts represent only a proportion of total climate and energy related spending in Member States' budgets.
Figure 9: Reported revenues from the auctioning of EU ETS allowances (millions of euros) in 2013 and share of these revenues or the equivalent in financial value used or planned to be used for climate and energy related purposes
* IT, EL: split between domestic and international use not reported. BE: no information on the use of auctionning revenues provided.
** No reporting provided.
Source: European Commission
Only some Member States reported information on the split of the use of revenues per type of action (see SWD). For instance, France, the Czech Republic and Lithuania use all their auctioning revenues in projects to improve the energy efficiency of buildings. Bulgaria, Portugal and Spain use most of their revenues to develop renewable energy. Poland uses most of its revenues that are dedicated to climate change in support of energy efficiency and renewable energy. In Germany, all auctioning revenues are used for climate and energy related purposed, with most of those revenue directed to a specific climate and energy fund, which supports a wide range of projects. Finland channels its auctioning revenues to Official Development Assistance activities, including climate finance. The UK uses around 15 % of auctioning revenues to provide financial assistance to low income households in relation to energy expenses.
5.3.1.2. NER 300
The NER 300 funding programme is mechanism in support of innovative renewable energy technology development and Carbon Capture Storage (CCS) demonstration projects. It is financed by the auctioning of 300 million allowances from the new entrants' reserve of the EU ETS. Two calls for proposals were launched under this programme.
The second call, awarded in July 2014, was funded from the sale of the remaining allowances and unused funds from the first call. 18 renewable energy and 1 CCS projects were selected and will receive €1 billion in total, which will generate private investments for a total value of almost €900 million. In total, the two calls will provide € 2.1 billion to 39 projects (38 in the field of renewable energy and 1 CCS project).
5.3.2. Mainstreaming Climate Policies into EU budget
5.3.2.1. Multiannual Financial Framework
As regards the mainstreaming of climate action into the EU budget, all Institutions have agreed that at least 20 % of the overall expenditures under the Multiannual Financial Framework (2014-2020) will be climate-related. The contribution towards climate expenditure in 2014 and in 2015 represents almost 13 % of the EU budget for each year.
A significant upward revision is expected as from the 2016 budget, when the Operational Programmes of the Member States under the European Structural and Investment Funds are adopted and the Common Agricultural Policy's new direct payment scheme, including the greening measures, is fully implemented.
5.3.2.2. Climate Research and Innovation
Climate research was one of the main research themes of the EU's 7th Framework Programme (2007-2013) and is central to Horizon 2020, the new EU programme for research and innovation 2014-2020, budgeted to € 79 billion. At least 35% of the Horizon 2020 budget is expected to be invested in climate-related objectives. This represents a significant increase compared to the estimated € 900 million that have been spent under the 7th Framework Programme.
For example, the Horizon 2020 Societal Challenge "Climate Action, Environment, Resource Efficiency and Raw Materials” (with a budget of about € 3 billion), supports mitigation research and innovation projects. These projects aim at analysing and mitigating the pressure on the environment (oceans, atmosphere, and ecosystems) and improving the understanding of climate change. In addition, research actions will focus on assessing impacts, vulnerabilities and solutions for adapting to climate change, developing strategies for disaster risk reduction and stimulating a transition to a low-carbon society and economy.
Climate change mitigation and adaptation are important drivers for programming research and innovation under all other Societal Challenges as well, notably in transport, energy, bioeconomy, and food, agriculture, and the in pillar “Industrial leadership”.
5.3.2.3. Supporting developping countries
With a share of 51 % of Official Development Assistance (ODA) for climate change from all donors reporting to OECD, the EU and its Member States have been the largest contributor to both mitigation and adaptation related ODA for the period 2010-2012.
As part of the fast-start finance commitment by developed countries of USD$30 billion, the EU and its Member States fulfilled their commitment by allocating € 7.34 billion to fast-start finance over that period. After the end of the Fast Start Finance period, the EU and its Member States have continued to provide climate finance support to developing countries in view of the developed countries goal to jointly mobilise USD$100 billion per year by 2020 from a wide variety of sources.
At the Doha Climate Change Conference in December 2012, the EU and a number of Member States announced voluntary climate finance contributions to developing countries. The total contribution is expected to exceed € 5.5 billion. An initial assessment shows that this amount was on track to be delivered in 2013[30].
In 2013, Member States submitted to the European Commission their first annual reports on financial and technology support provided to developing countries pursuant to Article 16 of the Monitoring Mechanism Regulation with information for the years 2011 and 2012. The total climate financial support provided to developing countries (2011-2012) by the EU and its Member States and per type of instrument is available in the tables of the SWD.
6. Situation in the Union's candidate countries and potential candidates
6.1. EU candidate countries (Albania, Iceland, Turkey, the Former Yugoslav Republic of Macedonia, Montenegro and Serbia)
Albania is a non-Annex I Party. According to its latest National Communication dated 2009, Albania's emissions have decreased by 70% between 1990 and 2000.
Iceland is an Annex I Party which met its individual target for the first commitment period[31]. For the second commitment period, Iceland, the EU and its Member States will enter into a joint emission reduction commitment (cf. section 2.1).
Turkey’s GHG emissions (excluding LULUCF) increased by 133 % between 1990 and 2012 and 3.7 % between 2011 and 2012. While Turkey is an Annex I Party, it has no target under the first or the second commitment period of the Kyoto Protocol.
The former Yugoslav Republic of Macedonia is a non-Annex I Party. It provided its third National Communication to the UNFCCC in March 2014. According to this document, total GHG emissions decreased by 22% between 1990 and 2009. In Montenegro, which is also a non-Annex I Party to the Convention, total GHG emissions (excluding LULUCF) increased by around 4.9 % between 1990 and 2003.
No recent information is available for Serbia regarding GHG emissions inventories.
6.2. EU potential candidates (Bosnia and Herzegovina and Kosovo*)
Bosnia and Herzegovina submitted its second National Communication in November 2013. Between 1991 and 2001, the total emission of Bosnia and Herzegovina decreased by 48 %.
No data are available for Kosovo.
[1] According to the 2014 inventory submission providing GHG emissions data up to 2012. Unless stated otherwise, all the GHG emission data are based on the Revised 1996 IPCC guidelines calculated using the global warming potential from the IPCC 2nd Assessment Report.
[2] For most Member States, this does not include yet the expected effects of the Energy Efficiency Directive and does not assume yet a full implementation of the Climate and Energy package.
[3] The approximated 2013 emissions data are estimates compiled by the EEA in the approximated EU GHG inventory for 2013.
[4] LU issued recently its own estimates according to which its ESD emissions in 2013 were 1.61% below the 2013 ESD target.
[5] See analysis by the European Environment Agency, section 4.3 hereafter
[6] The scope of the package differs from the scope of the Kyoto Protocol. It includes international aviation but excludes LULUCF and emissions of nitrogen trifluoride NF3.
[7] For most MS, these are the projections submitted in 2013. The following Member States submitted on a voluntary basis updated projections in 2014: CY, IE, LT, LU, PL and RO. Member States submissions were quality-checked, gap-filled and adjusted where necessary by the EEA. An estimation of the share of non-ETS emissions had to be made for several Member States. For the gap filling and ETS/non-ETS split estimation, data from the 2013 EU climate policy "baseline with adopted measures" projection based on the PRIMES and GAINS models have been used. This projection has also been used as sensitivity analysis in the first EU Biennial Report [SWD(2014)1].
[8] The approximated 2013 emissions data are estimates compiled by the EEA in the approximated EU GHG inventory for 2013 based on data submitted by Member States by 31 July 2014. Final emissions data will be available in 2015 using the new 2006 IPCC methodology on inventories.
[9] Data calculated with the global warming potential from the IPCC 4th Assessment Report
[10] ESD base-year emissions are calculated for each Member State so as to be consistent with both relative and absolute 2020 ESD targets.
[11] MT and CY have no target under the first commitment period.
[12] EEA 2014 - Why did GHG emissions decrease in the EU between 1990 and 2012? http://www.eea.europa.eu/publications/why-are-greenhouse-gases-decreasing
[13] primary energy consumption per unit of GDP
[14] CO2 per primary energy from fossil fuels
[15] Represented by the decomposition factor 'GDP per capita' in Figure 8
[16] http://www.pa.op.dlr.de/quantify/
[17] 7thFP project "Reducing Emissions from Aviation by Changing Trajectories for the benefit of Climate" (2010-2014)
[18] COM(2014) 15.
[19] COM(2014) 520
[20] COM(2014) 330
[21] See conclusions of the European Council (http://www.european-council.europa.eu/council-meetings/conclusions)
[22] See section 5.3.1.2
[23] COM(2013) 479
[24] Regulation (EC) n° 443/2009
[25] Regulation (EC) n° 510/2011
[26] Regulation (EC) n° 517/2014
[27] Decision 529/2013/EU of the European Parliament and the Council
[28] Certain Member States intend to use at least 50 % of auctioning revenues for climate related purposes. However; the revenues collected in 2013 have not been allocated yet and will be reported to subsequent years (for instance FI, LV and SK).
[29] According to their submissions, auctioning revenues in AT, DK, IE, NL and UK are not earmarked in their national budget and therefore no direct attribution to specific purposes is possible. The data reported only relates to examples covering a small part of overall climate-related spending.
[30] see http://ec.europa.eu/clima/policies/finance/documentation_en.htm. Each year, Member States submit to the European Commission information on financial and technology support provided to developing countries by 30 September.
[31] Iceland must limit the increase of emissions below 10 % on average over the first commitment period. Emissions decreased by a 2 % average over this period.
* This designation is without prejudice to positions on status, and is in line with UNSCR 1244/1999 and the ICJ Opinion on the Kosovo declaration of independence.
Table 1: Reported revenues from the auctioning of EU ETS allowances (millions of euros) in 2013 and share of these revenues or the equivalent in financial value of these revenues used or planned to be used for climate and energy related purposes
Country || Total reported revenues from the auctioning of allowances(millions of euro) || Used or planned to be used for climate & energy related purposes(domestic and international) || Share used or planned to be used for climate & energy related purposes
DE || 790.3 || 790.3 || 100%
UK(*) || 485.4 || 485.4 || 100%
IT || 385,9 || 192,9 || 50%
ES || 346.1 || 346.1 || 100%
PL || 244.0 || 128.7 || 50%
FR || 219.2 || 219.2 || 100%
EL || 147,6 || 147,6 || 100%
NL || 134.2 || 134.2 || 100%
RO || 122.7 || 91.2 || 74%
BE || 115.0 || not provided || not provided
CZ || 80.7 || 73.2 || 91%
PT || 72.8 || 70.4 || 100%
FI (**) || 67.0 || 33.5 || 50%
SK (***) || 61.7 || 61.7 || 100%
DK || 56.0 || 28.0 || 50%
AT || 55.8 || 29.9 || 66%
BG || 52.6 || 51.3 || 97%
IE || 41.7 || 41.7 || 100%
SE || 35.7 || 17.9 || 50%
HU || 34.6 || 17.3 || 50%
LT || 20.0 || 20.0 || 100%
EE || 18.1 || 9.0 || 50%
SI || 17.7 || 8.9 || 50%
LV (***) || 10.8 || 10.8 || 100%
LU || 5.0 || 2.5 || 50%
MT || 4.5 || 2.9 || 64%
HR || 0 || 0 ||
CY || no reporting provided || ||
Total || 3635.1(****) || 3052.1 || 87% (*****)
(*) The data submitted by the UK includes the early auctioning of ETS Phase III allowances in 2012.
(**) Finland currently channels all auctioning revenues to Official Development Assistance activities, including climate finance, which will account for 50% of these revenues. During the reporting year FI allocated approximately € 7 million of revenues, of which € 2 million were used for international purposes related to climate and energy. The use of the remainder of the funds will be reported in subsequent years.
(***) includes revenues that LV and SK plan to use for climate related purposes through a new financial instrument which will be funded directly from auctioning revenues.
(****) does not include Cyprus (no reporting provided).
(*****) does not include Belgium (share of revenues used for climate & energy related purposes not reported) and Cyprus.
Source: European Commission