The EU's revised Emissions Trading Scheme (ETS) Directive

Fertilizers Europe looks forward to working with the European Parliament and member states to make sure that the revised Emissions Trading Scheme (ETS) Directive does not become a tipping point for the closure of European industrial activity.

As the cornerstone of EU Climate Policy we look forward to working with the European Parliament and the member states to make sure that the revised Emissions Trading Scheme (ETS) Directive 203/87/EC proposal works in terms of effect on the climate and at the same time does not become a tipping point for the closure of European industrial activity.

Fetililizers Europe today issued a four step pathway in the European Parliament to ensure that the sector most exposed to carbon leakage has the adequate protection and can remain competitive in a global market.

Marek Kapłucha, Vice President, Fertilizers Europe said “Our industry is the most exposed sector to carbon leakage. The European Commission’s very own impact assessment illustrates this. Our unique situation in respect to chemically unavoidable emissions should be accounted for. There are 4 solutions that are needed”

  1. ETS should not be a tax on production. Therefore 100 per cent free allowances for unavoidable chemical process emissions should be granted.
  2. Benchmarks should reflect achievable technological progress. The differentiation proposed by the European Commission is welcome but does not go far enough. A correction factor of zero, or 0.2 per cent, for benchmarks should be applied where actual achievable emission reductions are significantly below 0.5 per cent.
  3. Any general adjustment in free emission allowances should not be uniform but graduated so that sectors at the highest risk of carbon leakage have their adjustment factors reduced, or even be exempted.
  4. Additional allocation of free allowances from new entrants’ reserves should be granted to companies showing a minimum of 10 per cent production increase.

“Fertilizers produced in Europe are the most emission friendly in the world. Placing Europe’s food security in the hands of fertilizer producers from outside Europe is very risky. Without the efficient and strong fertilizer industry in Europe 52.4 million tonnes of additional CO2 will be emitted globally. That is almost the equivalent of the total emissions of Sweden.” Jacob Hansen, Director General, Fertilizers Europe.

We wish to work with the European Institutions to continue to combat the effects of climate change. We must do this though in a way that is realistic and based on a proper understanding of sectors. Otherwise the societal benefits of fertilizers could be lost with the unfortunate consequence of more emissions from external sources being spread over our fertile land.

“The fertilizer industry takes great pride in being responsible for feeding half the Global population. The recent ETS proposal by the European Commission does not take account of the competitiveness of the European fertilizer industry. As a result the proposal threatens food security in Europe” Javier Goñi del Cacho, President, Fertilizers Europe.

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