Annual Report 2010 - Outokumpu

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Carbon dioxide emissions under EU Emissions Trading Scheme were still at lower than normal level in 2010 due to
reduced levels of production, approximately 795 000 tonnes (2009: 540 000 tonnes). Outokumpu's carbon dioxide
allowances in the UK, Sweden and Finland were sufficient for the Group's planned production.
The EU Emissions Trading Scheme after 2012
The European Commission (EC) and the European Parliament have agreed that the EU Emissions Trading Scheme
(ETS) will continue, with the next trading period being 2013–2020. On the third emissions trading period, 2013–2020, the
ETS will become a more restricting system. The total annual emission cap in Europe and share of free allocation of
emissions will gradually decrease. Auctions will be the main form of issuing allowances. Outokumpu's operations under
ETS will continue to receive free allocations according to efficiency-based benchmarks and historical activity. It is
estimated that Group will be some allowances short and that the situation will most likely vary more than before within
Group companies. One important issue for Outokumpu has been to qualify for a free allocation of emissions allowances
during 2013–2020 by being part of an industry sector where there is a significant risk of carbon leakage. According to an
EC decision, all of Outokumpu's ETS operations are currently qualified. Rules on how free allocations of emissions
allowances are to be distributed will be finalised during 2011.
The renewed ETS directive states that member states can offer companies compensation for carbon dioxide related
increases in electricity prices. As Outokumpu has three electricity-intensive installations in three different EU countries,
this is an important aspect.
Read more about emissions trading.
Voluntary energy efficiency agreements
Outokumpu has participated in voluntary national energy efficiency agreements in Finland, Sweden and the UK for many
years. The Tornio Works joined the Finnish programme at the beginning of the 1990s. Energy savings in electricity, heat
and fuel achieved during 2010 totalled 961 GWh. To ensure that systematic improvements in energy efficiency continue
to be achieved, Outokumpu sites in Finland signed new energy-efficiency agreements in December 2007 covering the
2008–2016 period.
In Sweden, the first round of the PFE (Programmet för energieffektivisering i energiintensiv industri) agreement – in
which the target was annual savings in electricity consumption of 4 GWh – ended in the summer of 2009 with savings of
8 GWh having been realised. The Group is a participant in the second period (2009–2014) of this agreement. In
connection with energy issues, Outokumpu usually works closely with national authorities – with Motiva in Finland and by
participating in the Jernkontoret forum in Sweden.
Outokumpu Annual Report 2010 – Business – Energy efficiency