CEMApεdia: ETS & LULUCF

The fight against climate change focuses on the reduction of greenhouse gas (GHG) emissions. In line with this, the International Protocol of Kyoto establishes legally binding obligations for developed countries to reduce their GHG emissions produced by different sectors (e.g. energy, industrial processes, agriculture and waste) by at least 5% below 1990 levels. The EU targets go beyond that and have set that by 2020 greenhouse gas (GHG) emissions will be reduced by 20% compared with 1990 levels.

What has the EU put in place to achieve this target?

In 2005, the EU Emissions Trading System (EU ETS) was launched as the cornerstone of its strategy for cutting emissions of carbon dioxide (CO2 ) and other greenhouse gases at least cost. The EU ETS works on the 'cap and trade' principle. A 'cap', or limit, is set on the total amount of certain greenhouse gases that can be emitted by the factories, power plants and other installations in the system. The cap is reduced over time so that total emissions fall. By putting a price on carbon and thereby giving a financial value to each tonne of emissions saved, the EU ETS  acts as a major driver of investment in clean technologies and low-carbon solutions.

Which are the greenhouse gases and sectors covered by the EU ETS system?

Carbon dioxide (CO2) from:

  • power and heat generation,
  • energy-intensive industry sectors including oil refineries, steel works and production of iron, aluminium, metals, cement, lime, glass, ceramics, pulp, paper, cardboard, acids and bulk organic chemicals
  • Commercial aviation

Nitrous oxide (N2O) from:

  • Production of nitric, adipic, glyoxal and glyoxlic acids

Perfluorocarbons (PFCs) from:

  • aluminium production

EU ETS covers more than 11,000 power stations and industrial plants in 31 countries, as well as airlines.

What about LULUCF?

LULUCF stands for Land use, Land Use Change and Forestry and thus covers GHG emissions into the atmosphere and removal of carbon from the atmosphere resulting from the use of soils, trees, plants, biomass and timber. Forests and agricultural lands currently cover more than three-quarters of the EU territory and naturally hold large stocks of carbon, preventing its escape into the atmosphere

In the light of a decision by UNFCCC parties in December 2011 to revise accounting rules for GHG emissions and removals from soils and forests, the Council and the European Parliament adopted a decision to harmonise accounting rules for these emissions and removals across the EU.

This initiative is a first step towards incorporating agriculture and forestry - the last major sectors without common EU-wide rules on GHG - into the EU's emission-reduction efforts.

A harmonised EU-wide emission will help to strengthen the capacity of forests and agricultural soils to preserve and capture CO2 in a sustainable manner. 

A recent consultation has been launched by the EC in order to collect input for the preparation of the forthcoming legislative proposal to harmonise LULUCF emissions at EU level.

CEMA contribution can be found HERE

For further information on this initiative please CLICK here

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