The European nuclear industry trade group Foratom on 21 February “partially” welcomed the outcome of a European Parliament vote on a European Commission (EC) proposal to revise the EU Emissions Trading System (ETS) for its next phase, which runs from 2021 to 2030.
Foratom said the ETS reforms, which still need to be passed by the European Council, should help to boost carbon prices but would fall short of fully aligning the ETS with the Paris Agreement. Under the Paris Agreement, which entered into force on 4 November 2016, 113 Parties, including the EU-28, have committed to limit the global temperature rise to below 2°C above preindustrial levels and to aim at 1.5°C.
The EU ETS was launched in 2005 and operates in 31 countries (the 28 EU countries, plus Iceland, Liechtenstein and Norway) and aims to limit greenhouse gas (GHG) emissions from more than 11,000 heavy energy-using industries (power plants and manufacturing facilities) and airlines operating between these countries. It covers about 45% of the bloc's GHG emissions. The EU's 2030 energy and climate policy framework is based on a binding target to reduce overall GHG emissions by at least 40% below 1990 levels by 2030. To achieve this cost-effectively, the sectors covered by the EU ETS will have to reduce their emissions by 43% compared with 2005, while non-ETS sectors will have to reduce theirs by 30%. The EC published its proposal in July 2015 to revise the directive on the EU ETS for the 2021-2030 period.
In December, Foratom issued a position paper, which said the EC proposals were headed in the right direction but more must be done to restore confidence in the ETS, so that it can help decarbonise the European economy in an affordable way. In its recent statement, Foratom said the ETS should be spearheading the switch from fossil fuels to low-carbon sources for electricity generation such as renewables and nuclear. If investments in low-carbon electricity production are to be incentivised, the price of carbon needs to be significantly higher than it is, Foratom said. Foratom said it supported an annual reduction in the cap on emissions of 2.4% and was disappointed that this was watered down to 2.2% in the vote. Nevertheless, Foratom said it welcomed the improvement over the current rate of 1.74%.
