Ireland: cement firms make windfall profits from ETS permits

Ireland: cement firms make windfall profits from ETS permits

CRH, Lagan Cement and Quinn Cement have together made EUR128m (US$145m) through the sale of permits under the EU emissions trading scheme (ETS). 

On Sunday, the Irish Independent reported that the three firms were allocated credits on the basis of a prediction that demand would rise by 30 per cent between 2007 and 2012. The impact of the financial crisis instead caused demand to drop by over 60 per cent, allowing the companies to sell off their un-needed carbon credits.

Donal O'Riain of Ecocem said: "The Irish cement industry makes massive wind-fall profits and ignores most potential to reduce its pollution, all this under an ETS scheme that is supposed to impose an economic incentive to reduce emissions from cement manufacturers. The EU bears a lot of this responsibility, while the Irish cement industry, keeping its head down and quietly pocketing from continuing to pollute, is hardly the best example of corporate responsibility."

Industry group Cement Manufacturers Ireland (CMI) said: "CMI member companies have invested over EUR300m [US$339m] in lower carbon production technology in recent years and continue to invest in reducing the carbon footprint of its production processes and products."

The windfall profits were highlighted by a European-wide study of the workings of the EU-ETS by Dutch environmental consultancy CE Delft. This found that cement companies across Europe had benefitted from over-allocation, with Cemex’s Spanish operations alone being granted EUR266m (US$300m) more than it needed. 

Overall, the study found that over-allocation had generated windfall profits of EUR2.65bn (US$3bn) in the European cement industry.