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Interim report of WG 5/6 subgroup: Review of Phase 2 NAPs

Interim report of WG 5/6 subgroup: Review of Phase 2 NAPs. Mark Johnson 22/02/07. Purpose of the Review. Inform ETG members Assessments of Phase 2 for internal use Develop positions and arguments for Phase 3 Provide Defra and DTI with industry view on key issues relating to Phase 2 NAPs

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Interim report of WG 5/6 subgroup: Review of Phase 2 NAPs

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  1. Interim report of WG 5/6 subgroup: Review of Phase 2 NAPs Mark Johnson 22/02/07

  2. Purpose of the Review • Inform ETG members • Assessments of Phase 2 for internal use • Develop positions and arguments for Phase 3 • Provide Defra and DTI with industry view on key issues relating to Phase 2 NAPs • Supporting evidence for EC review • Highlight similarities and differences • Put the UK in perspective

  3. Status of NAPs – An interim position

  4. Phase 2 Caps • Of those on target for Kyoto: Finland (18%), Belgium (11%), UK (11%) and Greece (9%) all sought significant reductions against BaU. • UK, although part of this group, does not stand out. • However, the EC’s decisions tend to bring all caps down to around 10 -20% below BaU (some minor exceptions). • UK’s position is therefore no exception after EC decisions. • BaU data not available for all NAPs.

  5. Auctioning • The UK is taking the lead in terms of percentage to be auctioned: • UK (7%) • Italy (6%) • Hungary (5%) • Luxembourg (4.8%) • Netherlands (4%) • However, when expressed in absolute terms the UK is planning to go much further. • Germany?

  6. Use of Project Credits • Most MSs have applied limits • Most are around 10% of total allocation • Main exceptions: • Ireland (proposed limit of 50% reduced to 21% by EC) • Spain proposes 39%, but… • Italy and Poland both propose 25%, but… • Germany now propose 20%, but… • The UK is broadly comparable with most other MSs • Most limits applied at installation level (except Belgium-Flemish, Spain, Finland and Portugal)

  7. Roles of sectors • Power sector: • Most MS seeking reductions • UK reduction factor is more severe than most • Industrial sectors • Little information on detailed differentiation • However, of 12 MSs with data available, only 4 intend to allocate BaU to all industrial sectors, including the UK • Of the 4, Slovakia and Sweden have since had further national reductions imposed by EC

  8. Allocation methodology • Within power sector there is a mix of grandfathering (13) and benchmarking (8). • Remainder either projections or not available. • For industrial sectors very little use of benchmarking. • Grandfathering baselines vary, but of 8 largest emitters: • Most do not use data before 2000 • Half exclude data from one or more years • Half use 2005

  9. New entry • Most countries have NER in range 5-10% allocation. • Those intending much larger NERs had cap reductions imposed by EC, so position may change…

  10. Way forward • Discussion today • Update and issue to WG5/6 (incl DTI and Defra), as Interim Report • Revise Report once all NAPs approved

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