CEMBUREAU: ‘EU-ETS proposal needs to incentivise best performers’

CEMBUREAU has taken note of the Commission’s proposals on EU ETSii post-2020 and will now proceed to a more indepth analysis with a view to engaging in a constructive discussion with the Commission, European Parliament and Member States, the association said in a statement yesterday.

CEMBUREAU notes that while the proposal does acknowledge the importance of a continued carbon leakage protection, it is disappointing in that it maintains the cross-sectoral correction factor.

"Even if the Commission claims its application will be minimised, the allocation to the best performer would be drastically reduced through the combined application with a percentage-based benchmark reduction. Our discussions with the institutions will focus on how to reconcile such an approach with the clear guidance given by the European Council in October 2014 that the most efficient installations in energy-intensive sectors should not face undue carbon costs leading to carbon leakage.

"It was clearly the intention of Heads of State and Government to incentivise industry to invest in low carbon technologies while maintaining growth and jobs in Europe. From a first assessment of the proposal, we feel that this balance has not been struck and our competitiveness will be negatively affected.

"Best performers need full free allocation to be able to further invest and benchmarks that are based on technological feasibility. We feel ourselves reinforced in our plea which is common to all energy-intensive industries who published an Open Statement on the issue in Politico last week," the industry body said.

CEMBUREAU added that it welcomes the Commission’s focus on support for innovation but hopes that carbon capture and reuse would also be eligible for such funding.