Dóra Fazekas Carbon Market Implications for new EU - UniCredit ...

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Verified emissions
Change compared to previous
year
2005 2006 2007 06/05 07/06 07/05
Paper 171,715 159,501 154,318 -7.11% -3.25% -10.13%
Tile and brick 624,324 617,005 619,183 -1.17% 0.35% -0.82%
Glass 275,273 283,544 288,650 3.00% 1.80% 4.86%
Cement 2,436,328 2.484,559 2,581,857 1.98% 3.92% 5.97%
Steel and iron 1,256,901 1.196,376 1,219,350 -4.82% 1.92% -2.99%
Metal ore 320,775 306,649 292,384 -4.40% -4.65% -8.85%
Coking 184,815 299,823 284,249 62.23% -5.19% 53.80%
Oil refining
Energy
1,317,231 1,345,427 1,430,045 2.14% 6.29% 8.56%
production 19,574,280 19,153,024 19,965,462 -2.15% 4.24% 2.00%
All sectors 26,161,642 25,845,908 26,835,498 -1.21% 3.83% 2.58%
Table 22. Changes in emissions at Hungarian sectors during the pilot phase
Source: author’s calculation based on NAP and CITL data (Mt)
Of the 240 registered Hungarian installations, 96 saw an increase in 2006 and 134 saw a decrease;
in 2007, 74 reported an increase and 155 a decrease in emissions – according to Róbert Reiniger of
Deloitte (2008); the remaining installations terminated their operations in 2007. A press release by
Deloitte indicates that the pilot phase did not bring about significant emissions-reduction measures.
Experts claim that the changes of at least 20% are a result of changes to production, the shutting
down and restarting of machines; changes smaller than this amount – primarily in the energy
industry – may be ascribed to meteorological changes (a mild or a harsh winter, for instance). This
finding was confirmed by those interviewed for this dissertation that claimed, the EU scheme did
not provide the necessary motivation for change. The insignificant extent of emissions reduction
witnessed in Hungary is probably due to two factors. One of these was the lax allocation practices
of the pilot phase; the other factor is that the price of emissions allowances during the second half
of the trading period plummeted, soon after the Hungarian Registry went online and trading could
commence. The author’s interviews revealed that emissions reduction measures, which were
realized, were in fact not due to the EU ETS; all of these measures would have been realized
without the introduction of the scheme, and were not driven by the possibility of trading
allowances.
Most installations achieved their reductions during the EU ETS pilot phase through the use of
biomass. Deloitte (2008) reports that switching to the use of sawdust was dominant in the ceramics
industry, and certain solid-fuel-burning power plants switched to the use of biomass – including
plant granulates, tallow, meat flour and wood – to reduce their carbon dioxide emissions. The same
trend was apparent in the cement industry, which began using wastewater silt, paper silt and energy
grass.
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