EU Emissions Trading Scheme (Hansard, 17 June 2004)

HC Deb 17 June 2004 vol 422 cc1076-7W 1076W

§ Miss McIntosh
To ask the Secretary of State for Trade and Industry if she will urge the European Commission to delay the start of the EU Emissions Trading Scheme until it has approved the National Allocation Plan of each member state. [178484]

§ Mr. Timms
The EU Emissions Trading Directive and related regulations on the monitoring and reporting of emissions from installations covered by the scheme comes into force in every member state from 1 January 2005.
It is crucial that NAPs from member states that have not been submitted to the Commission in sufficient time ahead of January 2005 are not subject to less thorough or differing assessment or approval mechanisms by the Commission. The UK has asked for clarification on this, and the Commission has stated that the three month period for assessment of the plan by the Commission will be retained, regardless of when the date of notification of the NAP is. Late submissions of National Allocation Plans will not lift the requirements to comply with the directive in any member state, rather it will deny industry the certainty and access to use of the market from the outset to help in compliance. There are no plans to call for a delay in the start of the scheme.

§ Miss McIntosh
To ask the Secretary of State for Trade and Industry what level of reliance other EU member states are placing on project credits available from the Kyoto project mechanism to meet their national targets for the EU Emissions Trading Scheme. [178486]

§ Mr. Timms
To date, 14 National Allocation Plans for the EU ETS, including the UK's, have been submitted to the European Commission. Of these, seven have indicated an intention to use purchase of JI and CDM to meet Kyoto targets in 2012. The level of these planned purchases as well as the state of advancement of these policies differs in each plan. In some cases, there are clear plans and substantiated programmes and funding for this, in others there is less clarity as to how firm the policy is, whether it has been budgeted for and from what sources.
1077W
The Commission has stated in a letter to all 25 member states on 17 March 2004.that the plans will be assessed for any State Aid implications that allocations may imply, in particular the use of public funds to buy Kyoto credits.

§ Miss McIntosh
To ask the Secretary of State for Trade and Industry what plans she has to enable UK companies fully to utilise the Joint Implementation and the Clean Development Mechanism components of the Linking Directive. [178487]

§ Mr. Timms
The Government are committed to ensuring that UK industry has access to the cost effective reduction potential that the JI and CDM mechanisms offer. The UK Climate Change Programme assumes some of the reductions envisaged to meet the 2010 goals and beyond may be made via use of these mechanisms.
In the context of the EU ETS, the linking amendment on the use of project credits from JI and CDM allows member states the discretion to consider whether or not such credits can be used for compliance against emissions covered by the EU ETS. The decision must be notified to the European Commission by June 2006. The Government are keen to allow the use of project credits from Phase One of the EU ETS and negotiated in favour of allowing early linking of the CDM from 2005. A final decision on how UK companies will be able to use such credits in the 2005–07 period of the EU ETS has not been made.