Environment Committee debates list of vulnerable sectors

An exchange of views on a draft European Commission measure on sectors deemed to be exposed to a significant risk of carbon leakage took place in the European Parliament’s Environment Committee earlier this month. This was the Committee’s first debate on the Commission’s proposed list of sectors at risk. The cement industry qualifies as a sector vulnerable to carbon leakage, with an increased cost of induced directly by the Emission Trading Scheme (ETSⁱ) of 55.06% (see May 2009 Eurobrief).

On 4 November a motion opposing the list was rejected by a substantial majority in ENVI thus ending the debate in the European Parliament. There is virtually no doubt that the Council will approve the list in time before 23 December 2009.

The list of exempted sectors would apply for the period 2015-2019, but could be revisited if an agreement during the forthcoming international climate change summit in Copenhagen in December is reached. The number of free allowances to be given to businesses deemed to be at risk of carbon leakage will be determined in 2011 based on best performance benchmarks. While the Commission emphasised that new sectors can be added to the list on a yearly basis, they cannot be taken off the list.