The Commission on 29 November gave its long-awaited appraisal of National Allocation Plans (NAPs) submitted by EU member states for the second phase of the emissions trading scheme, which runs from 2008-2012.
As Environment Commissioner Stavros Dimas put it, the decision on the allocation process for the second phase of the ETS was "a credibility test for Europe".
"I am confident that we have [passed] the test," he told a news conference, adding: "With today's decisions, the EU will affirm its leadership role in fighting climate change."
All ten allocation plans, except for Britain's, were rejected on the basis that they were overly generous in granting pollution permits to industry. Dimas said that he wanted to avoid a repetition of the May 2006 debacle when the publication of the first official emissions data revealed massive surplus allocations were left on the market, sending carbon prices crashing (EurActiv 16/05/06).
"We are determined not to let this happen during the second trading period because in order to have the ETS operating effectively we need scarcity in the market," Dimas explained.
National Allocation Plans: Summary (all figures in million tonnes of CO2)
| Member State | Cap 1st period (2005-07) | 2005 verified emissions | 2nd period (2008-12) Proposed cap | 2nd period (2008-12) Allowed cap |
| Germany | 499 | 474 | 482 | 453.1 |
| Greece | 74.4 | 71.3 | 75.5 | 69.1 |
| Ireland | 22.3 | 22.4 | 22.6 | 21.15 |
| Latvia | 4.6 | 2.9 | 7.7 | 3.3 |
| Lithuania | 12.3 | 6.6 | 16.6 | 8.8 |
| Luxembourg | 3.4 | 2.6 | 3.95 | 2.7 |
| Malta | 2.9 | 1.98 | 2.96 | 2.1 |
| Slovakia | 30.5 | 25.2 | 41.3 | 30.9 |
| Sweden | 22.9 | 19.3 | 25.2 | 22.8 |
| UK | 245.3 | 242.4 | 246.2 | 246.2 |
source: Commission
Germany emerges as the biggest loser in the process as it sees its proposed 482 mt cap rejected. "The annual allocation may not exceed 453.1 million allowances," the Commission explained.
Britain stands out as the only country to see its plan rejected for reasons other than over-allocation: Its list of industrial installations failed to include those in Gibraltar, the Commission said.
In what appears like a last-minute face-saving move, France informed the Commission on the evening of 28 November that it was withdrawing its plan "in order to improve it". Dimas indicated that he received assurances that France will re-submit its plan "within two weeks".
