{"id":3501179,"date":"2022-10-13T09:01:28","date_gmt":"2022-10-13T08:01:28","guid":{"rendered":"https:\/\/www.globalfactor.com\/?p=3501179"},"modified":"2022-10-13T09:18:01","modified_gmt":"2022-10-13T08:18:01","slug":"steelmakers-win-concessions-in-eu-carbon-market-reform-talks","status":"publish","type":"post","link":"https:\/\/www.globalfactor.com\/en\/steelmakers-win-concessions-in-eu-carbon-market-reform-talks\/","title":{"rendered":"Steelmakers win concessions in EU carbon market reform talks"},"content":{"rendered":"

The European steel industry will continue receiving free CO2 pollution permits as part of the reformed EU carbon market, according to the European Parliament\u2019s chief negotiator who said the deal was \u201cgood for jobs and investments in Europe\u201d.<\/p>\n

\u201cWe agreed to continue to support the steel industry by free allowances,\u201d Peter Liese, a German lawmaker and the Parliament\u2019s lead negotiator on the Emissions Trading Scheme (ETS), said in a statement after talks with EU member states and the European Commission held on Monday (10 October).<\/p>\n

According to the German lawmaker, the Commission\u2019s proposal would have entailed \u201ca much bigger step for the steel industry than for other industries\u201d as it would have tightened the benchmark against which free allowances for the steel industry are calculated.<\/p>\n

With Monday\u2019s agreement, the benchmark will remain unchanged, and the steel industry will continue receiving free allowances \u201cat least until 2032\u201d, Liese said.<\/p>\n

\u201cIn these times when jobs are under pressure, we think it\u2019s a good message that this proposal is off the table,\u201d said the Christian Democrat lawmaker, who hails from the centre-right European People\u2019s Party (EPP).<\/p>\n

But despite these concessions, the steelmakers will not be off the hook, Liese stressed, explaining that the industry will still be obliged to cut their emissions on an annual basis, with the annual cap on CO2 getting tighter and tighter every year.<\/p>\n

The European Commission tabled the reform in July 2021, proposing to phase out free pollution permits for the steel sector and other carbon-intensive industries, which currently receive the majority of their emission allowances for free.<\/p>\n

The ETS puts a limit on the emissions of around 10,000 large industrial plants in Europe, which have to buy pollution permits on the market for every tonne of CO2 they produce. The scheme is meant to encourage the take-up of clean technologies until the EU eventually reaches its target of reducing emissions to net zero by 2050.<\/p>\n

But with the energy crisis biting, EU negotiators decided to ease the pressure on steelmakers and other industrial emitters.<\/p>\n

The aluminium industry was also in line for some concessions following Monday\u2019s talks. Under the deal, industries like aluminium, which are impacted by high electricity bills and are highly exposed to foreign competition, will continue to receive indirect cost compensation, Liese said.<\/p>\n

\u201cThe compensation was never 100% so that efficiency and decarbonisation will always pay off,\u201d Liese said. \u201cBut it is important for this sector and other related sectors suffering from the high electricity prices to get predictability that they will continue to be compensated,\u201d he added.<\/p>\n

Eurofer, the European steel industry association, welcomed the outcome of the talks, saying it is \u201can important element for a sector where more than \u20ac30bn capital investments are required by 2030 to reduce emissions in line with EU emission reduction targets\u201d.<\/p>\n

Still, it said the sector was coming under tremendous pressure to decarbonise, saying \u201cfree allowances for the sector will still be reduced significantly due to the phase out trajectory\u201d applying to sectors covered by the EU\u2019s upcoming Carbon Border Adjustment Mechanism (CBAM).<\/p>\n

\u201cAt this stage, it is too early to say what the cumulative impact on the steel sector will be, as the legislation is currently under discussion,\u201d Eurofer told in an e-mailed statement.<\/p>\n

Slow progress<\/b><\/p>\n

Apart from these two points, there was scant progress in other aspects of the ETS reform, in particular when it comes to controversial plans to extend carbon trading to the transport and heating sectors.<\/p>\n

The Czech EU Council presidency, which speaks on behalf of the EU\u2019s 27 member states in talks with the European Commission and Parliament, failed to win a mandate from all EU countries to move the negotiation forward.<\/p>\n

This means the social policy aspect of the carbon market reform is currently stuck, with EU countries refusing to budge on a proposed Social Climate Fund intended to compensate households for rising energy costs expected to result from the reformed ETS.<\/p>\n

\u201cThe mandate of the Council for the Social Climate Fund is just a no-go,\u201d said Liese, who fumed at EU countries for \u201ccompletely ignoring the position of the Parliament\u201d on the subject.<\/p>\n

Michael Bloss, a German lawmaker who represents the Greens in negotiations with EU member states and the Commission, said the four-hour negotiation round \u201chas turned into a coffee date with a nice exchange\u201d but no concrete results.<\/p>\n

\u201cThis is a bad sign for the UN climate conference\u201d taking place in Sharm el-Sheikh next month, Bloss said. \u201cGoing to the climate conference in Egypt with this result is extremely embarrassing,\u201d he added in a statement, urging EU countries to \u201cprepare better\u201d for the UN climate summit.<\/p>\n

The European Commission is still officially pushing to finalise the ETS reform before the UN meeting but that objective now seems out of reach, with some even suggesting that negotiations could drag on until next year.<\/p>\n

\u201cUnfortunately, it\u2019s not possible to finish the ETS file before Sharm el-Sheikh,\u201d Liese admitted, saying \u201cmore than 90%\u201d of the issues are still on the table and aren\u2019t expected to be resolved until the last round of trilogue talks in December.<\/p>\n

\u201cI don\u2019t expect that the big issues like ambition or ETS2 will be off the table before the last trilogue. So there will be a lot of work bilaterally, at the technical level and informally, to get it ready before Christmas,\u201d he said.<\/p>\n

The next \u2018trilogue\u2019 negotiation round is scheduled for 10 November, with another expected to be scheduled later that month.<\/p>\n

Source: Euractiv<\/p>\n<\/div><\/div><\/div><\/div><\/div>\n","protected":false},"excerpt":{"rendered":"","protected":false},"author":1,"featured_media":3498440,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"content-type":"","inline_featured_image":false,"footnotes":""},"categories":[89,88],"tags":[],"class_list":["post-3501179","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-daily","category-news"],"yoast_head":"\nSteelmakers win concessions in EU carbon market reform talks - Global Factor<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.globalfactor.com\/en\/steelmakers-win-concessions-in-eu-carbon-market-reform-talks\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Steelmakers win concessions in EU carbon market reform talks - 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