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CO2 quotas
 

2What does this consist of?2 The European Union is implementing a greenhouse gas emissions trading scheme with a view to reducing these emissions in the Community in an economically efficient manner. With this system, the Community and the member States are trying to comply with the commitments to reduce greenhouse gas emissions made as part of the Kyoto protocol. The installations involved in activities in the sectors of energy, the production and processing of ferrous metals, the mineral industry and paper and cardboard manufacturing must be subject to this emissions trading scheme.

The European Union asked industrial companies to lead the way in terms of reduction in carbon dioxide emissions. The directive on the emissions trading scheme stipulates that the States allocate the companies from six industrial sectors generating the most greenhouse gas emissions (production of energy, cement, glass, ferrous metals, mineral industries, pulp), as well as the operators of combustion facilities of over 20MW, emission quotas. With the implementation of an emissions trading market, the European Union should be able to reduce its emissions by 8% by 2010. 2Quota allocation2 The National Quota Allocation Plan (PNAQ) defines a maximum quota amount according to reduction potential, expected growth in the sectors concerned, then allocates it to these sectors. In each sector, the allocation is then divided pro-rata of the emissions of each installation. Finally, the quotas are transferred from State accounts to an account opened for each operator within a national register. 2Returned quotas2 Each year, by 30 April, the company must return the same quota of tons of CO2 as the previous year. The emissions disclosure is verified by an authorised auditor and controlled by the Inspectorate. 2Purchase of quotas2 When the amount of emissions is likely to exceed the quota amount allocated and an action to reduce emissions is not economically viable, the company can purchase quotas on the market at any time from another company with excess quotas. 2What if a company’s CO2 emissions are too high?2 If, by the end of April, the company has not returned enough quotas to cover its disclosed emissions, the Prefect issues a statement of offence and gives the operator formal notice to comply within one month (limitation of CO2 emissions, purchase of quotas, transfer from one installation account to another installation account etc.). After this date, he will fine them €100 per ton of excess CO2, the payment of which does not free the operator from his obligations, i.e. he will still have to purchase the required quotas.

For more information on the system…

In France, greenhouse gas emissions are disclosed on the website of the pollutant emissions register (GEREP).

Legislation

Emissions trading Directive: European Parliament and Council Directive no. 2003/87/CE of 13 October 2003 establishing a scheme for greenhouse gas emission quota trading within the Community and amending Council directive 96/61/CE Articles L229-5 to 229-19 Book II, title II, chap IX of the environmental code

Amended decree no. 2004-832 of 19 August 2004 implementing articles L. 229-5 to L. 229-19 of the environmental code relative to the scheme for greenhouse gas emission quota trading, integrated into articles R229-5 to R229-37 of the environmental code

Order of 15 November 2005 relative to the supporting documents to be provided with regard to applications for the allocation or preservation of greenhouse gas emission quotas in case of a new installation, changed installation or transfer of activity

Amended order of 28 July 2005 relative to the verification and quantification of the emissions disclosed within the framework of the scheme for greenhouse gas emission quota trading Technical and specific appendices

Order of 22 October 2007 relative to the accreditation of bodies verifying the emissions declared within the framework of the scheme for greenhouse gas emission quota trading

Amended order of 31 May 2007 setting the list of operators to which greenhouse gas emission quotas are allocated and the amount of these quotas for the 2008-2012 period

Order of 31 march 2008 relative to the verification and quantification of the emissions declared within the framework of the scheme for greenhouse gas emission quota trading for 2008-2012