By Troels Werner Christensen, 3. September 2007
The EU Commission has adopted the Danish CO2 allocation plan for Kyoto period 2008-12. The acceptance requires a reduction in the use of climate credits under which only 17 per cent of the Danish obligations may be covered by JI/CDM allowances instead of 19 per cent. This means a reduction of 0.5 million tonnes of CO2.
- Under the plan, the electricity sector’s allowances allocation has been reduced by more than 40 per cent. Basically this puts the Danish power stations in a difficult competitive situation, because the electricity sector in competing countries like Poland and Germany has been allocated far higher allowances, says Charlotte Søndergren, Senior Consultant at the Danish Energy Association.
- This makes the use of climate credits an important tool for Danish power stations in their attempt to ensure cost-effective climate measures and to maintain competitiveness.
- The Commission’s demand for further restrictions on the use of climate credits is thus a problem to the extent that it involves restrictions on the power stations.
- For the sake of competitiveness Danish power stations must not be penalised more than absolutely necessary. Strict allowance allocations should therefore be accompanied by a freedom for Danish power stations to choose their own fuel and by an economic framework ensuring higher use of biomass and waste, Søndergren emphasises.
The Commission has only the final three allocation plans to negotiate, those from Portugal, Romania and Bulgaria.