Climate change and ETS

The Emission Trading System (ETS) is the cornerstone of the EU's strategy to fight climate change and meet the target of a reduction in greenhouse gases (GHG) emissions by 20% below 1990 levels by 2020. The European ceramic industry is highly committed to contributing to the achievement of this target. In order to minimise the environmental impact of clay products throughout all their life cycle, the industry has made significant investments in sustainable production and energy efficient technologies over the last decades, including heat recovery, co-generation and fuel substitution from coal to natural gas. The European ceramic industry is characterised by a great number of SMEs, which represents only 1% of the total CO2 emissions but more than 10% of industrial installations under the EU ETS. As an industry including several trade-intensive sectors, the European ceramic industry considers an international agreement – with equivalent burdens for all its parties – as the most appropriate solution to tackle the worldwide challenge of the climate change and ensure a global playing field with the other major trading partners. 

Directive 2003/87/EC sets the scope and the framework rules of the EU ETS. It was last amended in April 2009 by Directive 2009/29/EC. The EU ETS is based on a 'cap and trade' system, which defines the overall level of GHG emissions and, within that limit, allows companies to trade allowances at the market price of carbon. According to the revised ETS Directive, auctioning will replace grandfathering as the basic allocation system in the third trading period (2013-2020). However, transitional performance-based free allowances are foreseen for sectors exposed to the risk of carbon leakage, i.e. the risk of relocation in third countries with no equivalent environmental requirements. The limit for the level of free allowances will be defined by product-based benchmarks representing the level of GHG emissions of the 10% best performers for each product group. 

As a member of the European Climate Change Programme Working Group (ECCP WG), Cerame-Unie has contributed to the debate related to the revision of the Directive 2003/87/EC and the implementation of the revised ETS Directive, including the definition of the list of carbon leakage sectors and the rules on free allocation.