Norway announced on 8 March that it will conform to an EU directive laying down the rules and procedures for the European carbon-trading system, even though the country is not an EU member.
The announcement comes as EU heads of states meeting in Brussels prepare to make a bold new pledge to cut emissions of greenhouse gases "unilaterally" by 20% in 2020 compared with 1990 levels.
The Norwegian trading scheme should be up and running in time for the period 2008-2012, which coincides with the second trading period under the EU-ETS.
But Finance Minister Kristin Halvorsen said that the Norway scheme will however differ from the EU's. "We will now have a much tougher system than the EU," Reuters reported her as saying at a new conference on 8 March. "We will be a leader in the fight against climate change."
The Norwegian system would cover around 40% of the country’s greenhouse-gas emissions but with fewer pollution permits allocated to industries than under the EU scheme, Halvorsen said. With fewer pollution credits, Halvorsen anticipates that the price to emit one tonne of CO2 should climb to around $24, or higher than the current EU level.
In the meantime, a carbon tax on the country's industries will be removed so that the overall burden on industry remains the same.
Sectors to be covered by the scheme include energy production, oil refining, metals, steel, cement and ceramics production and the wood industry and fisheries, the finance ministry said in a statement.
The Norwegian scheme will be adopted with a law to be passed in 2008, after an initial consultation period that will run until 15 April 2007.
The announcement comes as an encouragement for the Commission, which wants to create a nucleus for a wider CO2 trading system that it hopes would eventually include other industrialised nations such as the US.