Reduction of Emissions

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• Reduction of Emissions
• in Emissions Trade
• Potential Targets

Jüri Teder, Climate Ozone Bureau of EEIC
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• Contents
• Background - environmental legal
• The EU emissions trading scheme
• About the reduction of emissions with the help of
  ETS
• Targets

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• Background - environmental
• Increase of greenhouse gases content in ambient
  air - marker gas CO2. More CO2 in atmosphere,
  higher aver. terrestrial atmosphere temp. (288K)

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• The Black scenario on global warming impacts.
• Surplus to current average K Speculated
  Results
• lt 1.0 K Pressure and impacts on eco- and Earth
  life supporting systems the
  Caribbean Sea hurricane kitchen works well
• 1.5 K Greenland ice cap starts to melt.
  Decrease of content of salts in North-Atlantic
  waters. Retardation of Gulf Stream
• 2-3 K Loss of coral reef, considerable species
  loss, large impacts on agriculture, increase in
  draughts and extreme rainfalls, up to 88 cm sea
  level rise in next 100 years. Un-predictable
  reaction of mankind (ignoree of rules of
  civilised society), appearance of environmental
  refugees
• 4 K North-Atlantic circulation collapses
  and the consequences
• over 4.5 K West Antarctic ice sheet (6
  m) collapses and the consequences.

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• Background - legal
• UN Framework Convention on Climate Change (1992)
  Estonia ratified on 27. July 1994. (main tool
  Article 17, Protocols)
• Kyoto protocol to the UN Framework Convention on
  Climate Change Estonia ratified on 3. Sept.
  2002. (main tools Article 3 - do
  not exceed the assigned amount calculated
  pursuant to quantified emission limitation
  Article 17 the parties may participate in
  emissions trading for fulfilling their
  commitments under Art. 3)
• Directive of the European Parliament and of the
  Council establishing a scheme for greenhouse gas
  emission allowance trading within the Community
  and amending Commission Directive 2003/87EC and
  Council Directive 96/61 EC.
• Commission Decision K(2004) 3982/8 final. The
  Estonian National Allocation plan is compliant
  with Directive 2003/87.
• Two regulations of the Government of the Republic
  of Estonia. January 2005.
• Regulation of the Minister of Environment,
  February 2005.

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• Main purpose of the Kyoto Protocol (KP)
• To ensure that parties of the Protocol
  ensure their anthropogenic CO2 equiv. emission of
  greenhouse gases do not exceed the assigned
  amounts. (At least 5 below 1990 year level in
  the commitment period 2008-2012. For Estonia is
  8 below i.e 92 of 1990 year level. Estonian
  Kyoto target is 34.2 mill.t CO2)

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• The EU emissions trading scheme (ETS)
• Taking into consideration the
  mechanisms of KP on reducing the GHG emissions,
  the EU has developed a company level scheme for
  trading in emissions of CO2.
• The ETS bases on a price for carbon
  emitting and availability of a liquid carbon
  market.
• Started in the 25EUNorway on 1st Jan.
  2005.
• The aim of the trading
• meet the EU member states its Kyoto target
  cost-effectively
• EC estimates the achievement of Kyoto targets
  with ETS will cost 3.7 bill. per annum, without
  6.8 bill/y. Somebody will really enjoy the
  cap--trade system.
• allow companies to use credits from Kyoto
  project-based mechanisms
• (JI CDM)
• make attractive the investments into emission
  reduction projects worldwide.

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• About the reduction of emissions with the help of
  ETS (How does emissions trading benefit companies
  and the environment?)

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• The ETS practically.
• Ruling document Directive of the European
  Parliament and of the Council 2003/87EC
• MS ensures that an installation resulting in
  emissions shall hold a permit issued by the
  competent authority (art. 4).
• Every MS has to compile the NAP, a very strick
  document on amounts of allowances (art 9). It is
  up to installation use all the allowances or
  find how to save them and sell the unused. The
  allowance - as a virtual currency.
• Every MS has to establish a registry to ensure
  accounting, issue, holding, transfer and
  cancellation of allowances (art 19).
• The EC shall designate a Central Administrator
  (CA) to maintain an independent transaction log
  (CITL) recording the issue, transfer and
  cancellation of allowances (art. 20).

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• Visualisation of ETS (slide from Mr. Jukka
  Moisanen presentation)

Contains 26 NAPs
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National registry has the hard- and software to
communicate with CITL and allow the access to the
account holders for trading purposes. NAP is the
database that is uploaded into registry. (slide
from Mr.Jukka Moisanen presentation)
43 installations
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• FEATURES of the national registry
• Web based system for holding and transferring of
  allowances
• Operates in real time
• Public site available 24hrs, 365 days a year
• functions
• registration of users/account holders
  (company/individuals)
• user management (eg. create/add/delete users)
• account management (opening/closing/view
  history)
• keeping track of the ownership of allowances
  (transaction/cancellation management)
• management of allowances compliance
  (retirement/reconcillation)

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• Registries in MS that making sure to trade
  close to 8,000 installations in the system

Software
GRETA, England
Seringas, France
Siemens
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• As the EU trading scheme has started some TARGETS
  topical
• to finalise the ETS. Put all MS with 12,000
  installations and 6.6 milliard t of CO2 on
  pre-Kyoto period into the system. Thus, 46 of
  the EUs total CO2 emissions will be under
  control and monitored. Despite there might be
  little diminishing in CO2 emissions, the
  gap-and-trade philosophy and CO2 cost will
  encourage the companies to put into practice the
  strategy to meet their obligations set up by
  NAPs. Thus, the startegy will help to decrease in
  actual CO2 emissions.
• to smooth the jumps in CO2 market price
• Low-volatile market price of a CO2 ton helps the
  installation to plan
• their trading and investments tactics.
• to absorb chemical indystry installations into
  system
• to absorb the tradable units of CDM and JI
  projects after opening of the Kyoto period.

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• Thank you!
• Last, but not least
• The Estonian register is active for allowance
  trading since 31st of October 2005.