Carbon 2009 Emission trading coming home - UNEP Finance Initiative

Carbon 2009
power and industry to decline by
1.74 percent every year.
Is the EU ETS now up to the
task of delivering the long-term
emission reduction needed? For
the fourth year in a row, we have
asked our survey respondents
to evaluate the workings of the
EU ETS. On four questions,
respondents are asked to choose
one alternative on a scale from
1 (“completely disagree”) to 5
(“completely agree”). We count
options 4 and 5 as agreement.
The result is given in Figure 2.6.
Increased maturity
of EU ETS?
The results of the overall EU
ETS evaluation among our
respondents are relatively stable
over time, with the exception
of the question of whether the
market is mature. Here we see
a clear increase over time, from
roughly 10 percent in 2006 and
2007 to 18 percent last year and
25 percent this year. Perhaps the
transition from phase 1 to phase
2, with its greater reduction
requirement, has helped increase
the perception of maturity in the
market.
At the same time, the statement
that the “EU ETS is the most
cost-efficient way to reduce
emissions in the EU” has seen
a steady, albeit slow, decline
from 2006 to 2009. The share of
respondents agreeing (options 4
or 5) with this statement is down
from 47 percent in the first year
it was asked, to 42 percent this
year.
More fundamentally than
trading, the evaluation of the EU
60%
50%
40%
30%
20%
10%
0%
Figure 2.7: EU ETS and internal abatement
Companies covered by EU ETS (2009) or CO2 regulation in general (2007);
slightly different wording of questions in 2007. N=353 (2009).
The EU ETS has not
caused any
emission reductions
in our company
Source: Point Carbon
The EU ETS has
caused reductions
to be planned but
not yet started
ETS must hinge on the degree
to which it reduces emissions in
the EU. Hence, we have sought
to assess the degree of internal
abatement in the EU ETS by
asking companies directly about
their own actions. Here, the
results are almost unchanged
from last year, with 46 percent
of the respondents reporting
abatement caused by the EU ETS
(exactly the same number as last
year), and three in ten reporting
no emission reductions, see
Figure 2.7.
In sum, the surveys from 2007
to 2009 indicate that just under
two-thirds of companies in
the EU ETS have reduced or
started to plan reductions as a
consequence of the EU ETS. The
share is consolidating at this level,
with exactly 62 percent reporting
abatement or planned abatement
in both 2008 and 2009. Another
The EU ETS has
already caused
emission reductions
in my company
2007
2008
2009
Don't know/
not relevant (2007)
question, of course, is the volume
of these abatement efforts: Are
they incremental improvements,
do they represent a conversion
to zero-carbon technology, or
something in-between? Given
that a majority of installations
report emission reductions,
while overall internal abatement
in the EU ETS is relatively low,
most installations have probably
implemented incremental
reductions rather than radical
ones.
Most installations
implement incremental
reductions
The distribution of abatement
action is fairly uniform across the
main EU ETS sectors, as displayed
in Figure 2.8. The highest degree
of reported abatement is seen in
8
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