EU sets 2013 industry CO2 cap at 1.927 bln tonnes

LONDON Fri Jul 9, 2010 9:45am EDT

LONDON (Reuters) - Greenhouse gas emissions from heavy industry currently regulated under the European Union's Emissions Trading Scheme will be capped at 1,926,876,368 tonnes of carbon dioxide in 2013, the EU Commission said on Friday.

In the scheme's third phase, which runs from 2013-2020, the emissions cap will then be tightened at an annual rate of 1.74 percent of the average Phase 2 (2008-2012) cap of 2,032,998,912 tonnes, or by 35,374,181 tonnes per year, the Commission said on its website.

But the 2013 cap, 2.4 percent below an estimate of 1.974 billion made by the Commission in 2008, could be revised further if new entrants join or emissions reduction projects under the Kyoto Protocol do not yield the number of carbon offsets needed by installations.

"Final figures for the 2013 cap may thus not be available before 2013. In order to keep the public informed, the Commission will update the figures in 2011 or later," the Commission said on its website, adding that any changes should be marginal.

Trevor Sikorski, director of emissions research at Barclays Capital, also called the 2013 figure incomplete.

"Today's cap is missing emissions from aviation and from new installations, new sectors like aluminum and new gases like nitrous oxide, which will be covered under the scheme from 2013," he said.

Under the $100 billion EU scheme, climate-warming greenhouse gases from industry are capped and around 11,000 industrial installations are forced to surrender permits for every tonne of carbon dioxide equivalent they emit.

Carbon emissions from the aviation sector are due to be included in the scheme from 2012.

The linear reduction from 2013 will lead to a total cap of around 1.7 billion tonnes by 2020, Reuters calculations showed, 20 million tonnes below a previous Commission target of 1.72 billion.

The cap for 2013 and subsequent years could be reduced further if the EU decides to raise its bloc-wide 2020 emissions target to 30 percent below 1990 levels, up from 20 percent now, the Commission said.

"Today's decision reflects the 20 percent reduction target (and) translates into a 21 percent cut in emissions from installations in the EU ETS by 2020 compared with 2005 levels," it said.

A final decision on the 2020 target is expected in the autumn.

(Reporting by Michael Szabo; Editing by Keiron Henderson)

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