EU ETS: cement sector included on EU carbon leakage risk list

EU ETS: cement sector included on EU carbon leakage risk list
Published: 10 November 2014


On 27 October, the European Commission adopted the list of sectors expected to be at risk of carbon leakage, which will be applicable for the period 2015-19. The list includes the cement industry, a fact welcomed by Cembureau, the European cement producers’ association. “The risk of carbon leakage has increased since 2009 as a direct result of the reduction in the competitiveness of the European cement industry because of the deep economic crisis and rising energy and electricity costs. The second carbon leakage list will provide stability and legal certainty for the cement industry at least for the 2014-2019 period,” according to Cembureau.

In the run-up to the Commission’s decision, several papers regarding the EU ETS were published. A paper entitled “What is Needed in the EU’s 2030 Climate and Energy Framework”, Climate Strategies outlines a series of areas for consideration by the Council. While options include raising the carbon price the EU-ETS should be cost effective and that any reduction in the cap should be carried out at a rate that is relevant to investment, innovation and strategic time horizons for business, according to Climate Strategies. The paper also offers recommendations for non EU-ETS sectors, including appropriate sectoral coverage.

The Centre for European Policy Studies has also published a commentary paper examining the shortcomings of the ETS and its goal of driving a low-carbon economy. Issues raised include carbon leakage, competitiveness and the carbon price.

The International Emissions Trading Association (IETA) published its position paper on the EU’s Framework for Climate and Energy Policies after 2020. “The EU ETS must remain he central pillar of the EU’s Climate and Energy package to reduce emissions at least possible cost,” states the IETA. The organisation also highlights the need to protect the EU industry’s competitiveness, avoid carbon leakage and guarantee a consistency in policies.