Transcript Modernisation Fund

The Emissions Trading System – ETS
Innovation Fund, Modernisation Fund
and Indirect costs
Marcin Bodio, Ph.D.
Chief Executive Officer, CEEP
the 4th of May, 2016
1
About CEEP
Major Tasks
Central Europe Energy Partners
represents the interests of the energy and energyintensive companies from Central Europe.
Actually, CEEP represents 24 companies and
organisations from six Central European countries,
employing over 300,000 workers, with a total annual
revenue of more than EUR 50 billion.
It is the first major body to represent the energy
sector companies from the region at the EU level.
The aim of CEEP is to strengthen the region’s
energy security within the framework of a common
EU energy and energy security policy.
CEEP is an international non-profit association with
its headquarters in Brussels, and a branch in Berlin.
 To increase the energy security
of Central Europe, as well as
the European Union as a whole.
 To strengthen the idea of energy
solidarity within the Energy Union.
We do believe that only the common
activities of all EU Member States
could be successful in enhancing
the energy security of Europe.
 To build relations and facilitate
contacts
between
Member
organisations and EU bodies and
agencies, individual representatives
and associations of energy and energyintensive sector companies, as well as
international energy sector think-tanks
and lobbies.
2
GDP per capita – UE 28
(000’EUR)
Saturated
EU Economies
Average GDP
per capita:
EUR 31,600
(2014 data)
Non-Saturated
EU Economies
Average GDP
per capita:
EUR 10,500
(2014 data)
Source: CEEP based on Eurostat data
3
GDP per capita – UE 28
(000’EUR)
Saturated
EU Economies
Non-Saturated
EU Economies
Source: CEEP based on Eurostat data
4
A Member State’s freedom to shape its energy-mix
Electricity production , 2013 (bilion kWh)
Thanks to the Lisbon Treaty
(art.192,194), each Member State
has the right to shape its own energymix. This article has been violated
many times, as coal, for example, is
a fuel excluded from consideration for
the building of new, high-energy,
efficient power plants, when Member
States need to be financially helped,
directly or indirectly.
The EU’s approach needs to be
changed in this respect.
Source: Making it happen – Paving the way for the Central European North-South Infrastructure
Corridor; CEEP, Roland Berger Strategy Consultants
Data does not include Malta and Cyprus.
5
CO2 emissions per capita
(per capita CO2 emissions of fossil fuel use and industrial processes )
The EU’s goal of a 20% CO2 emissions decrease by 2020
was already achieved in 2013
2011
2012
2013
2011
2012
2013
Belgium
10,61
10,22
10,29
Malta
3,73
3,65
3,69
Denmark
7,83
6,97
7,39
Netherlands
9,99
9,75
Germany
9,68
9,97
10,21
Austria
9,15
Ireland
8,46
8,63
8,56
Portugal
Greece
8,12
7,75
7,10
Spain
6,07
5,93
France
5,72
Italy
(tonnes/cap, 2013)
2011
2012
2013
Latvia
3,94
3,87
3,83
9,66
Lithuania
6,05
6,14
5,92
8,91
9,00
Hungary
5,13
5,01
4,72
4,66
4,72
4,60
Poland
8,60
8,38
8,47
Finland
11,25
9,93
10,57
Romania
4,17
4,00
3,68
5,27
Sweden
5,38
5,05
5,04
Slovenia
8,19
7,97
8,07
5,67
5,73
U.K.
7,51
7,77
7,53
Slovakia
7,34
6,96
7,13
6,78
6,77
6,39
Bulgaria
7,61
6,98
6,50
Croatia
5,24
5,29
5,37
Cyprus
6,61
6,49
6,59
Czech Rep.
11,52
10,98
10,66
Luxembourg
21,47
20,66
20,42
Estonia
16,34
15,53
15,75
EU
7,95
7,53
7,35
2011
2012
2013
2011
2012
2013
USA
17,07
16,28
16,55
Canada
16,10
15,72
Australia
19,10
Japan
10,09
Source: JRC, CEEP
2011
2012
2013
Russia
12,55
12,70
12,62
Brazil
2,32
2,43
2,56
15,67
South Korea
12,62
12,62
12,72
Turkey
4,38
4,51
4,41
17,63
16,92
China
6,97
7,17
7,42
Indonesia
1,93
1,93
1,95
10,75
10,70
India
1,49
1,60
1,65
South Africa
6,33
6,29
6,25
6
ETS discussions
CO2 prices versus emissions
Tonnes per capita
EUR
The average annual
prices of CO2
Source: CEEP
The EU GHG emissions per capita
Source: JRC
7
ETS discussions
implementation of new technologies and innovations
Idea
Implementation
Success
The driving force is in the implementation of new technologies and
innovations. It clearly indicates that such mechanisms as backloading and
MSR have lost their sense of purpose in relation to the decrease of CO2
emissions, especially in the EU-11 countries, also referred to as “lowerincome Member States”.
8
Modernisation Fund: 2021-2030 – EU proposal
A fund to support investments in modernising energy systems, and improving energy
efficiency, including ETS and non-ETS sectors, in Member States with a GDP per capita
below 60% of the Union’s average in 2013.
 To support the modernisation of energy systems in lower income Member States
and fully exploit the power sectors’ potential to contribute to cost-effective emission
reductions, the proposal foresees two measures: 1) the continuation of the free
allocation to the power sector, and 2) the creation of a Modernisation Fund.
 The Modernisation Fund is created from 2% of the overall quantity of allowances.
 The funds will be distributed between eligible Member States.
9
Modernisation Fund: 2021-2030 – EU proposal
Distribution of funds from the Modernisation Fund up to the 31st of December, 2030.
Share of Modernisation Fund:
10
Modernisation Fund: 2021-2030 – CEEP’s Position
Source
of funds
Beneficiares
and allocation
of funds to the
countries
Yes
Yes
2% of the
overall
quantity
of CO2
allowanc
es
Poland
Czech Republic
Romania
Hungary
Slovakia
Bulgaria
Estonia
Croatia
Lithuania
Latvia
Direction of spending
Sovereignty in the choice
of Energy sources
A legitimate interest in
Fund management
Yes
Support the
modernisation of energy
systems in lower income
Member States and fully
exploit the power
sectors’ potential to
contribute to costeffective emission
reductions including coal
power plants
Yes
Yes
Lisbon Treaty (art.192,194),
each Member State has a
right to shape its own
energy- mix
Beneficiary Member States
No
EIB
other EU countries
11
CEEP’s Modernisation Fund Proposals, including
the joint paper of the 10 eligible CE Countries
 The Fund should be managed by beneficiary Member States.
 The governance and rules of the Fund should be transparent.
 The EIB may be involved as an advisory body.
 Full respect for the specificity of the beneficiary countries energy-mix and
technology neutrality should be preserved.
 Other EU Member States should not participate in the decision-making
process in the selection of the project implemented in one Member
State.
12
Modernisation Fund
Conclusions for consideration:
• Modernisation fund will cover 30% of total costs connected with
the necessity of buying EUA, when the MSR is introduced.
• Energy-intensive industries should get 100% free allowances.
• Derogation for coal power plants should be extended up to 2030
for new 46 % efficient power plants, and up to 2025 for old
power plants.
13
Thank you for your attention
Central Europe Energy Partners, AISBL
Rue Froissart 123–133, 1040 Brussels
www.ceep.be
Phone: +32 2 880 72 97, Fax: +32 2 880 70 77, E-mail: [email protected]
Transparency Register No. 8773856374594
14