– EU Strategy –

The European Union has long been committed to international efforts to tackle climate change and felt the duty to set an example through robust policy-making at home. At European level a comprehensive package of policy measures to reduce greenhouse gas emissions has been initiated through the European Climate Change Programme (ECCP).

The European Commission established the ECCP in 2000 to help identify the most environmentally effective and most cost-effective policies and measures that can be taken at European level to cut greenhouse gas emissions. The immediate goal was to help ensure that the EU meets its target for reducing emissions under the Kyoto Protocol. Each of the originally 25 EU Member States (there are currently 28) had also put in place its own domestic actions that build on the ECCP measures or complement them.

The ECCP is a multi-stakeholder consultative process that has brought together all relevant players, such as the Commission, national experts, industry and the NGO community. Stakeholder involvement is an essential element of the ECCP because it enables the programme to draw on a broad spectrum of expertise and helps to build consensus, thereby facilitating the implementation of the resulting policies and measures.

The First European Climate Change Programme (2000-2004)

The first ECCP examined an extensive range of policy sectors with potential for reducing greenhouse gas emissions. The goal is to identify and develop all the necessary elements of an EU strategy to implement the Kyoto Protocol. Coordinated by an ECCP Steering Committee, 11 working groups were established. Each working group identified options and potential for reducing emissions based on cost-effectiveness.

The EU’s greenhouse gas emissions have been falling thanks to the combined impact of policies and measures resulting from the first ECCP, domestic action taken by Member States and the restructuring of European industry, particularly in central and eastern Europe.

By 2003, combined emissions from today’s 25 Member States (EU-25) were down 8% compared to their levels in the respective base years (mostly 1990). Emissions from the 15 ‘old’ Member States (EU-15) had fallen by 1.7%, or 2.9% averaged over 1999-2003.

European Trading Scheme

The European Trading Scheme is the world´s largest Greenhouse Gas (GHG) trading program! Find out next which steps led to its implementation.

The program is based on an “economic” system for reducing carbon emissions. It creates a financial incentive to reduce emissions by assigning a cost to pollution. Regulating entity establishes “cap” that limits emissions from a designated group of polluters to a level lower than their current emissions.

Allowed emissions are then allocated as individual allowances (right to emit one ton of CO2) that correspond to the right to emit that amount. Companies are free to buy and sell allowances in order to reduce emissions in most cost-effective manner. Companies that are able to reduce emissions at a low cost can sell extra allowances to companies that would face high costs (i.e., implementing new technology).

Phase I (2005 – 2007) covered CO2 emissions from:

– Large emitters in the power and heat generation industry

– Selected energy-intensive industrial sectors (combustion plants, oil refineries, coke ovens, iron and steel plants)

Approximately 12,000 installations in the 25 Member States are covered. Large Industrial emitters account for around 45% of the EU’s total CO2 emissions and about 30% of its overall greenhouse gas emissions

From 2005 to 2012, the strategy can be separated in two different phases. While phase I focused on CO2 and larger companies, the second phase strated including other GHG emissions.

Phase I (2005-2007):

– Pilot Phase

– CO2 only

– Covers large industrial emitters

Phase II (2008-2012):

– Inclusion of other Greenhouse Gases (methane, nitrous oxide, sulphur hexafluoride, HFCs, and PFCs)

– Aviation emissions

– Increased penalties imposed on any excess emissions (from €40 to €100 per ton of CO2)

Each EU country is required to submit a national allocation plan (NAP) for approval by the European Commission. NAPs determine the total quantity of CO2 emission allowances for a member state and allocations for each company within that state.

An allocation plan has to reflect a Member State’s Kyoto target as well as its actual and projected progress towards meeting it. Allocations to installations must take account of their potential for reducing emissions from each of their activities, and must not be higher than the installations are likely to need.

Penalties for emissions in excess of surrendered allowances of €40/ton CO2 in Phase I, and €100/ton CO2 in Phase II. Excess emissions must be offset in the following compliance period.

Additional administrative and criminal penalties (for example, for fraudulent reporting) are left to the Member States. The names of operators who are not in compliance are published.

Joint Implementation (JI): allows companies in countries with a Kyoto target to develop projects in other Annex 1 countries that reduce their emissions of greenhouse gases.

Example: Netherlands is financing the construction of a wind farm in New Zealand with an expected annual output of 325 GWh. Emission reductions are estimated to equal 530 000 tons of CO2 equivalent per year.

Clean Development Mechanism (CDM): allows companies in Annex 1 Parties to implement projects that reduce emissions and contribute to sustainable development in countries without a Kyoto target (non-Annex I Parties, i.e. developing countries).

Example: Netherlands is also financing the construction of a wind farm in China and two electricity-generating plants in India that are fueled by biomass

As a general rule, installations should be allowed to use JI and CDM credits to supplement their allowance allocation by up to 10%.

Currently, the EU ETS is in its third phase (2013-2020), which is significantly different from phases 1 and 2 (Step 3).

The main changes from the previous two phases are:

– A single, EU-wide cap on emissions applies in place of the previous system of national caps

– Auctioning is the default method for allocating allowances (instead of free allocation), and harmonised allocation rules apply to the allowances still given away for free

– More sectors and gases included

– 300 million allowances set aside in the New Entrants Reserve to fund the deployment of innovative renewable energy technologies and carbon capture and storage through the NER 300 program

Want to understand better how the system works? Check out the video below:

Circular Economy

What is Circular Economy?

In a circular economy, the value of products and materials is maintained for as long as possible. Waste and resource use are minimised, and when a product reaches the end of its life, it is used again to create further value. This can bring major economic benefits, contributing to innovation, growth and job creation. A circular economy encourages sustainability and competitiveness in the long term. It can also help to:

– Preserve resources – including some which are increasingly scarce, or subject to price fluctuation

– Save costs for European industries

– Unlock new business opportunities

– Build a new generation of innovative, resource-efficient European businessesmaking and exporting clean products and services around the globe

– Create local low and high‐skilled jobs

– Create opportunities for social integration and cohesion

Action Plan

– “Closing the loop” of product lifecycles through greater recycling and re-use.

– Extract the maximum value and use from all raw materials, products and waste, fostering energy savings and reducing Green House Gas emissions.

– Proposals cover the full lifecycle of products: from production and consumption to waste management and the market for secondary raw materials.

If you want to know more about the EU action plan, just check out this link: EU – Circular Economy Action Plan – or watch the official video of the European commission below.

Another input according to circular economy is given by Thomas Rau. Thomas Rau studied architecture at RWTH Aachen University and held the following presentation at the TEDxZwolle. For those of you who are more interested in this subject, just take a look at his speech:


What is the idea and goal of the EU Traiding Scheme?

What are the main points for the scheme to work?

Do you think the scheme is working? (Controversy)