Activities of Michael BLOSS related to 2021/0202(COD)
Plenary speeches (2)
Revision of the Market Stability Reserve for the EU Emissions Trading System (debate)
Binding annual greenhouse gas emission reductions by Member States (Effort Sharing Regulation) - Land use, land use change and forestry (LULUCF) - Revision of the Market Stability Reserve for the EU Emissions Trading System (debate)
Shadow reports (1)
REPORT on the proposal for a decision of the European Parliament and of the Council amending Decision (EU) 2015/1814 as regards the amount of allowances to be placed in the market stability reserve for the Union greenhouse gas emission trading scheme until 2030
Amendments (14)
Amendment 12 #
Proposal for a decision
Recital 1
Recital 1
(1) The Paris Agreement, adopted in December 2015 under the United Nations Framework Convention on Climate Change (UNFCCC) entered into force in November 2016 (“the Paris Agreement”)25. The Parties to the Paris Agreement have agreed to holdIn its 2018 Special Report on the impacts of global warming of 1,5°C above pre- industrial levels, in its 2019 Special Reports on Climate Change and Land and on the Ocean and Cryosphere in a Changing Climate, and in its 2021 Report on the Physical Science Basis, the Intergovernmental Panel on Climate Change (IPCC) provided the latest scientific evidence on the impacts of climate change and illustrated the need to urgently reduce greenhouse gas (GHG) emissions in all sectors of the economy in order to limit global warming to 1,5°C. By adopting the Glasgow Climate Pact, the Parties to the Paris Agreement recognised that the increase in the global average temperature well below 2to 1,5 °C above pre-industrial levels and to pursue efforts to limit would significantly reduce the risks and impact of climate change, and committed to strengthen temperature increase to 1,5 °C above pre-industrial levels. heir 2030 targets by the end of 2022 to close the ambition gap. The revision of the European Union Emissions Trading System (EU ETS), including of its market stability reserve, is a unique opportunity to contribute to stepping up the Union's climate action before the United Nations Framework Convention on Climate Change 27th session of the Conference of the Parties (UNFCCC COP27) in Egypt. __________________ 25 Paris Agreement (OJ L 282, 19.10.2016, p. 4).
Amendment 31 #
Proposal for a decision
Recital 5
Recital 5
Amendment 32 #
Proposal for a decision
Recital 6
Recital 6
(6) In Regulation (EU) 2021/1119 of the European Parliament and of the Council29 the Union has enshrined the target of economy-wide climate neutrality by 2050achieving an economy-wide balance between anthropogenic emissions by sources and removals by sinks of greenhouse gas emissions within the Union by 2050 at the latest in legislation. That Regulation also establishes a binding Union domestic reduction commitment of net greenhouse gas emissions (emissions after deduction of removals) of at least 55 % below 1990 levels by 2030. __________________ 29Regulation (EU) 2021/1119 of the European Parliament and of the Council of 30 June 2021 establishing the framework for achieving climate neutrality and amending Regulations (EC) No 401/2009 and (EU) 2018/1999 (‘European Climate Law’) (OJ L 243, 9.7.2021, p. 1).
Amendment 36 #
Proposal for a decision
Recital 7
Recital 7
(7) All sectors of the economy need to contribute to achieving those emission reductions. Therefore, the ambition of the EU Emissions Trading System (EU ETS), established by Directive 2003/87/EC of the European Parliament and of the Council30, should be adjusted to be in line with the economy-wide net greenhouse gas emissions reduction commitment for 2030target for 2030 and the commitment to achieve climate- neutrality within the Union by 2050 at the latest. __________________ 30Directive 2003/87/EC of the European Parliament and of the Council of 13 October 2003 establishing a system for greenhouse gas emission allowance trading within the Union and amending Council Directive 96/61/EC (OJ L 275, 25.10.2003, p. 32).
Amendment 37 #
Proposal for a decision
Recital 8
Recital 8
(8) In order to address the structural imbalance between supply and demand of allowances in the market, which has been accumulated since the start of the EU ETS due to generous allocation of free allowances leading to continuously low carbon prices preventing the EU ETS from providing strong incentives for emissions reduction, Decision (EU) 2015/1814 of the European Parliament and of the Council31 established a market stability reserve (the ‘reserve’) in 2018, which has been operational since 2019. __________________ 31 Decision (EU) 2015/1814 of the European Parliament and of the Council of 6 October 2015 concerning the establishment and operation of a market stability reserve for the Union greenhouse gas emission trading scheme and amending Directive 2003/87/EC (OJ L 264, 9.10.2015, p. 1).
Amendment 44 #
Proposal for a decision
Recital 11
Recital 11
(11) Directive (EU) 2018/410 of the European Parliament and of the Council32 amended Decision (EU) 2015/1814 by doubling the percentage rate to be used for determining the number of allowances to be placed each year in the reserve from 12 % to 24 % until 31 December 2023, as a way to rapidly absorb the historical surplus in order to provide a stronger price signal to reduce GHG emissions in a cost-efficient manner. That decision was taken in the context of the former Union 2030 climate target of reducing economy- wide GHG emissions by at least 40 % compared to 1990 levels. __________________ 32Directive (EU) 2018/410 of the European Parliament and of the Council of 14 March 2018 amending Directive 2003/87/EC to enhance cost-effective emission reductions and low-carbon investments, and Decision (EU) 2015/1814 (OJ L 76, 19.3.2018, p. 3).
Amendment 52 #
Proposal for a decision
Recital 14
Recital 14
(14) The analysis carried out in the context of the reserve’s review and the expected developments relevant to the carbon market demonstrate that a rate of 12 % of the total number of allowances in circulation to be placed in the reserve each year after 2023 is insufficient to prevent a significant increase of the surplus of allowances in the EU ETS. Therefore, after 2023 the percentage figure should continue to be 24 %, and the minimum number of allowances to be placed in the reserve should also continue to be 200 million.
Amendment 56 #
Proposal for a decision
Recital 14 a (new)
Recital 14 a (new)
(14a) Studies suggest that, due to the increased Union 2030 climate target and the recent coal phase-out announcements from several Member States, if the intake rate would be kept at 24 % until 2030, the reserve would only allow to prevent a new surplus to be generated but is unlikely to be sufficient to further reduce the historical surplus already accumulated in the market, let alone the impact of the COVID-19 pandemic1a. __________________ 1aUmweltBundesamt (2021). Structural Supply Side Management in the EU ETS.
Amendment 57 #
Proposal for a decision
Recital 14 b (new)
Recital 14 b (new)
(14b) According to the 2021 Carbon Market Report, the total number of allowances in circulation has already increased in 2020 to 1 579 billion allowances, compared to 1 385 billion allowances in 2019. This sharp increase in the overall surplus is linked to a lower demand due to the COVID-19 crisis. The Commission estimates that it will take up to four years for that additional 2020 surplus to be absorbed, thereby further delaying the urgent need to absorb the historical surplus and finally make the EU ETS fit for purpose.
Amendment 60 #
Proposal for a decision
Recital 15
Recital 15
(15) If the rate of the total number of allowances in circulation to be placed in the reserve each year reverts to 12 % after 2023, a potentiallysignificant harmful surplus of allowances in the EU ETS may disturb market stability. In addition, the rate of 24 % after 2023 should be established separately from the general review of Directive 2003/87/EC and Decision (EU) 2015/1814 to strengthen the EU Emissions Trading System in line with the Union’s increased climate ambition for 2030 to ensure market predictabilitywill continue to disturb the proper functioning of the EU ETS.
Amendment 68 #
Proposal for a decision
Recital 15 a (new)
Recital 15 a (new)
(15a) Therefore, the intake rate should be increased to 36 % as of 2023. That decision should be taken separately from the on-going general review of Directive 2003/87/EC and Decision (EU)2015/1814 in order to ensure market predictability. The environmental integrity of the reserve, including the intake rate, can be further increased in the context of that general review.
Amendment 70 #
Proposal for a decision
Recital 15 b (new)
Recital 15 b (new)
(15b) The Commission should continuously monitor the functioning of the reserve. A safeguard clause should be created to ensure that the reserve is kept fit for purpose despite unforeseeable external shocks.
Amendment 80 #
Proposal for a decision
Article 1 – paragraph 1
Article 1 – paragraph 1
Decision (EU) 2015/1814
Article 1 – paragraph 5 – subparagraph 1
Article 1 – paragraph 5 – subparagraph 1
By way of derogation from the first and second sentences, until 31 December 2030, the percentages and the 100 million allowances referred to in those sentences shall be doubtripled.
Amendment 87 #
Proposal for a decision
Article 1 – paragraph 1 a (new)Decision (EU) 2015/1814
Article 1 – paragraph 1 a (new)Decision (EU) 2015/1814
Article 3 – paragraph 1
In Article 3, the first paragraph is replaced by the following: 'The Commission shall monitor the functioning of the reserve in the context of the report provided for in Article 10(5) of Directive 2003/87/EC. That report should consider relevant effects on competitiveness, in particular in the industrial sector, including in relation to GDP, employment and investment indicators. Within three years of the start ofevaluate the effectiveness of the reserve in view of meeting the Union’s climate intermediary targets set out under Regulation (EU) 2021/1119. It should also consider relevant effects on competitiveness, in particular in the industrial sector, including in relation to GDP, employment and investment indicators. When, on the basis of that report, the Commission finds out that the total number of allowances in circulation has increased compared to the previous year, it shall make a legislative proposal, as appropriate and based on a detailed impact assessment, to amend this Decision to ensure the propera functioning of the reserve and at five- year intervalin rapidly and steadily absorbing the structural imbalance between supply and demand of allowances in the market. Notwithstanding the first paragraph, by 1 January 2026 and every five years thereafter, the Commission shall, on the basis of an analysis of the orderly functioning of the European carbon market, review the reserve and submit a proposal, where appropriate, to the European Parliament and to the Council. Each review shall pay particular attention to the percentage figure for the determination of the number of allowances to be placed in the reserve pursuant to Article 1(5) of this Decision, as well as the numerical value of the threshold for the total number of allowances in circulation and the number of allowances to be released from the reserve pursuant to Article 1(6) or (7) of this Decision. In its review, the Commission shall also look into the impact of the reserve on growth, jobs, the Union's industrial competitiveness and on the risk of carbon leakage.'