2021/0202(COD) | [ParlTrack]

Draft legislative resolution
Citation 2

— having regard to Article 294(2) and Article 192(12) of the Treaty on the Functioning of the European Union, ~~pursuant to which~~and the Commission proposal submitted ~~the proposal~~ to Parliament (C9- 0325/2021),

Amendment 12 #

Proposal for a decision
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 hold~~In 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 2~~to 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 t~~emperature 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 13 #

Proposal for a decision
Recital 1

Amendment 14 #

Proposal for a decision
Recital 1 a (new)

(1a) The urgency of not exceeding the Paris Agreement goal of 1,5 °C has become more significant following the findings of the Intergovernmental Panel on Climate Change (IPCC) in its reports of 7 August 2021 entitled ‘Climate Change 2021: The Physical Science Basis’ and of 8 October 2018 entitled ‘Global warming of 1.5 °C’. The IPCC found that the consequences of climate change are much more destructive if global warming is failed to delimit to 1,5 °C and reaches 2°C. In addition, global temperature will reach or exceed the 1,5 °C mark earlier than previously anticipated, namely averaging over the next 20 years. It also found that unless there are immediate and ambitious reductions in greenhouse gas emissions, it will no longer be possible to limit global warming to close to 1,5 °C or even 2°C.

Amendment 15 #

Proposal for a decision
Recital 1 b (new)

(1b) In its resolution of 28 November 2019 on the climate and environment emergency1a, the European Parliament urged the Commission to take immediate and ambitious action to limit global warming to 1,5°C and to avoid massive biodiversity loss, including by addressing inconsistencies in current Union policies with the climate and environment emergency and by ensuring that all relevant future legislative and budgetary proposals are fully aligned with the objective of limiting global warming to under 1,5°C and that they do not contribute to biodiversity loss. __________________ 1a P9_TA(2019)0078

Amendment 16 #

Proposal for a decision
Recital 1 c (new)

(1c) The need for urgent action is further intensified by the increase in the frequency and intensity of extreme weather conditions as a direct result of climate change. According to the United Nations Office for Disaster Risk Reduction, the number of disasters recorded and the scale of economic losses have nearly doubled in the last 20 years, much of which increase corresponds to the significant rise in the number of climate-related disasters that pose a significant threat to human health. Furthermore, in its resolution 48/13 of 8 October 2021, the U.N. Human Rights Council recognised right to a safe, clean, healthy and sustainable environment as a human right.

Amendment 17 #

Proposal for a decision
Recital 1 d (new)

(1d) The Union should therefore address this urgency by stepping up its efforts and establishing itself as an international leader in the fight against climate change while reflecting the principles of equity and of common but differentiated responsibilities and respective capabilities, as laid down in Article 2(2) of the Paris Agreement.

Amendment 18 #

Alexandr VONDRA, Pietro FIOCCHI, Grzegorz TOBISZOWSKI, Jadwiga WIŚNIEWSKA, Andrey SLABAKOV

Proposal for a decision
Recital 1 e (new)

(1e) The Union’s climate and environmental policy should be implemented in line with the principle of a fair and just transition that leaves no one behind. In addition, pursuant to Article 191(2) of the Treaty on the Functioning of the European Union (TFEU), Union policy on the environment is to aim at a high level of protection taking into account the diversity of situations in the various regions of the Union, and is to be based on the precautionary principle and on the principles that preventive action should be taken, that environmental damage should, as a priority, be rectified at source and that the polluter should pay.

Amendment 19 #

Proposal for a decision
Recital 2

(2) Tackling climate and environmental-related challenges and reaching the objectives of the Paris Agreement are at the core of the Communication on “The European Green Deal”, adopted by the Commission on 11 December 201926 . However, the legislative proposals foreseen in "The European Green Deal" should take into account evolving circumstances, and in particular the economic and energy crisis the Union is facing at the moment putting many businesses at competitive disadvantage and many household at risk of energy poverty. __________________ 26 COM(2019)640 final.

Amendment 20 #

Proposal for a decision
Recital 2

(2) Tackling climate and environmental-related challenges and reaching the objectives of the Paris Agreement are a~~t the core of~~ddressed in the Communication on “The European Green Deal”, adopted by the Commission on 11 December 201926 . __________________ 26 COM(2019)640 final.

Amendment 21 #

Alexandr VONDRA, Pietro FIOCCHI, Grzegorz TOBISZOWSKI, Jadwiga WIŚNIEWSKA, Andrey SLABAKOV

Proposal for a decision
Recital 3

(3) The European Green Deal combines a comprehensive set of mutually reinforcing measures and initiatives aimed at achieving climate neutrality in the EU by 2050, and sets out a new growth strategy that aims to transform the Union into a fair and prosperous society, with a modern, resource-efficient and competitive economy, where economic growth is decoupled from resource use. It also aims to protect, conserve and enhance the Union's natural capital, and protect the health and well-being of citizens from environment-related risks and impacts. At the same time, this transition affects women and men differently and has a particular impact on some disadvantaged groups, such as older people, persons with disabilities and persons with a minority racial or ethnic background. It must therefore be ensured that the transition is just and inclusive, leaving no one behind.deleted

Amendment 22 #

Proposal for a decision
Recital 3

Amendment 23 #

Proposal for a decision
Recital 3

(3) The European Green Deal combines a comprehensive set of mutually reinforcing measures and initiatives aimed at achieving climate neutrality in the EU by 2050, and sets out a new growth strategy that aims to transform the Union into a fair and prosperous society, with a modern, resource-efficient and competitive economy, where economic growth is decoupled from resource use. It also aims to protect, conserve and enhance the Union's natural capital, and protect the health and well-being of citizens from environment-related risks and impacts. At the same time, this transition affects women and men differently and has a particular impact on some disadvantaged and vulnerable groups, such as older people, persons with disabilities ~~and~~, persons with a minority racial or ethnic background and low and lower-middle income individuals and households. It also imposes greater challenges on certain regions, especially structurally disadvantaged regions. It must therefore be ensured that the transition is just and inclusive, leaving no one behind.

Amendment 24 #

Proposal for a decision
Recital 3

(3) The European Green Deal ~~combines a comprehensive set of mutually reinforcing measur~~provides a starting point for achievement of the Union’s climate-neutrality objective by 2050 at latest and ~~initiatives aimed at achieving climate neutrality in the EU by 2050,~~the aim to achieve negative emissions thereafter as laid out in Article 2(2) of Regulation (EU) 2021/1119. It combines a set of mutually reinforcing measures and initiatives and sets out a new growth strategy that aims to transform the Union into a fair and prosperous society, with a modern, resource-efficient and competitive economy~~, where economic growth is decoupled from resource use~~. It also aims to protect, conserve and enhance the Union's natural capital, and protect the health and well-being of citizens from environment-related risks and impacts. At the same time, this transition affects ~~women and men~~all genders differently and has a particular impact on some disadvantaged groups, such as older people, persons with disabilities and persons with a minority racial or ethnic background. It must therefore be ensured that the transition is just and inclusive, leaving no one behind.

Amendment 25 #

Proposal for a decision
Recital 4

(4) The necessity and value of the European Green Deal have only grown in light of the very severe effects of the COVID-19 pandemic on the health, living and working conditions and well-being of the Union’s citizens, which have shown that our society and our economy need to improve their resilience to external shocks and act early to prevent or mitigate them. European citizens continue to express strong views that this applies in particular to climate change27 . In addition, the Intergovernmental Science-Policy Platform on Biodiversity and Ecosystem Services (IPBES) in its report of 29 October 2020 entitled ‘Biodiversity and Pandemics’ pointed out that the underlying causes of pandemics are the same global environmental changes that drive biodiversity loss and climate change. Climate change has been implicated in disease emergence and will likely cause substantial future pandemic risk. According to the report, the cost of inaction vastly outweighs the cost of action. __________________ 27Special Eurobarometer 513 on Climate Change, 2021 (https://ec.europa.eu/clima/citizens/support _en).

Amendment 26 #

Proposal for a decision
Recital 4

(4) The necessity and value of ~~the~~ Europe~~an Green Deal~~'s industrial capacities have only grown in light of the very severe effects of the COVID-19 pandemic on the health, living and working conditions and well- being of the Union’s citizens, which have shown that our society and our economy need to improve their resilience to external shocks and act early to prevent or mitigate them. European citizens continue to express strong views that this applies in particular to climate change27 . __________________ 27Special Eurobarometer 513 on Climate Change, 2021 (https://ec.europa.eu/clima/citizens/suppo rt_en).

Amendment 27 #

Proposal for a decision
Recital 4

(4) The ~~necessity and value of the European Green Deal have only grown in light of the very severe~~ effects of the COVID-19 pandemic on the health, living and working conditions and well-being of the Union’s citizens~~, which~~ have shown that our society and our economy need to improve their resilience to external shocks and act early to prevent or mitigate them. ~~European citizens continue to express strong views that this applies~~According to the strong views of European citizens, such shocks include, in particular to, climate change~~27 . __________________ 27Special Eurobarometer 513 on Cli~~. A well-implemented European Green Deal can matke ~~Change, 2021 (https://ec.europa.eu/clima/citizens/suppo rt_en)~~a major contribution to strengthening the resilience of our society and economy.

Amendment 28 #

Antoni COMÍN I OLIVERES

Proposal for a decision
Recital 4 a (new)

(4a) The COVID-19 pandemic has brought to light the inherent connection between, on the one hand, the health of our environment and biodiversity, and, on the other, the health of human beings, as stated by the One Health approach. It has accentuated the need to mitigate climate change in order to sustain and improve the health of our biodiversity, therefore in turn protecting human health. European citizens have also expressed strong views on the need to tackle climate change as a priority to improve public health.

Amendment 29 #

Proposal for a decision
Recital 4 a (new)

(4a) Legislative proposals should take into account evolving circumstances, and in particular, the economic and energy crisis the Union is currently facing, which is putting many businesses at competitive disadvantage and increasing the households at risk of energy poverty. Particular attention should be paid to speculative actions that can affect this and should be addressed immediately.

Amendment 30 #

Proposal for a decision
Recital 4 b (new)

(4b) The Union is committed to fight against energy poverty, with at least 50 million Europeans still suffering from energy poverty, and should ensure that its legislative proposals and amendments affecting the energy sector do not impede efforts in this regard.

Amendment 31 #

Proposal for a decision
Recital 5

(5) The Union committed to reduce the Union’s economy-wide net greenhouse gas emissions by at least 55 % by 2030 below 1990 levels in the updated nationally determined contribution submitted to the UNFCCC Secretariat on 17 December 202028 . __________________ 28 https://www4.unfccc.int/sites/ndcstaging/ PublishedDocuments/European %20Union %20First/EU_NDC_Submission_Decemb er %202020.pdfdeleted

Amendment 32 #

Proposal for a decision
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 2050~~achieving 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 33 #

Proposal for a decision
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 2050 at latest and the aim to achieve negative emissions thereafter 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 34 #

Proposal for a decision
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 2030, the Union’s climate-neutrality objective by 2050 at latest and the aim to achieve negative emissions thereafter laid out in Article 2(2) of Regulation (EU) 2021/1119 and the goal of the Paris Agreement, while reflecting the principles of equity and of common but differentiated responsibilities and respective capabilities of nations. __________________ 30 Directive 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 35 #

Proposal for a decision
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 2030. __________________ 30Directive 2003/87/EC of the European Parliament and of the Council of 13 October 2003 establishing a system fo without jeopardising their recovery, provided that the net greenhouse gas emissions reduction commitment for 2030 is maintained, after gre~~enhouse gas emission allowance trading within the Union and amending Council Directive 96/61/EC (OJ L 275, 25.10.2003, p. 32)~~vision, and achievable.

Amendment 36 #

Proposal for a decision
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 2030~~target 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

(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 38 #

Proposal for a decision
Recital 8

(8) In order to address the structural imbalance between supply and demand of allowances in the market, 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. The creation of the reserve has contributed to reducing the surplus of allowances in circulation by 29 % from its record level in 2013 to the 2019 level, and has strengthened the resilience of the EU ETS. __________________ 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 39 #

Proposal for a decision
Recital 8

(8) In order to address the structural imbalance between supply and demand of allowances in the market, which weakened the EU ETS through lower carbon prices leading to insufficient incentives for emission reductions, 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 40 #

Proposal for a decision
Recital 8 a (new)

(8a) A robust and forward-looking reserve is essential to ensure the integrity of and effectively steer the EU ETS in order for the policy tool to contribute to the Union’s climate-neutrality objective by 2050 at latest and the aim to achieve negative emissions thereafter laid out in Article 2(2) of Regulation (EU) 2021/1119. The EU ETS, and therefore the reserve, should also be aligned with the pursuit to limit the global temperature increase to 1,5°C above pre-industrial levels, recognizing that this would significantly reduce the risks and impacts of climate change, while reflecting equity and the principle of common but differentiated responsibilities and respective capabilities, in the light of different national circumstances pursuant to Article 2 of the Paris Agreement.

Amendment 41 #

Eric ANDRIEU

Proposal for a decision
Recital 10

(10) Where the number of allowances in circulation is above the established upper threshold, an amount of allowances corresponding to a given percentage of these allowances is deducted from the volumes of allowances to be auctioned and placed in the reserve. Meanwhile, a corresponding number of allowances is released from the reserve to Member States, and added to the volumes of the allowances to be auctioned, if the total number of allowances in circulation falls below the established lower threshold. In order to limit the threshold effects, it should also be possible to adjust the reserve in case of sudden rise of the allowance prices by empowering the Commission to release allowances to be added to the volumes of the allowances to be auctioned.

Amendment 42 #

Proposal for a decision
Recital 10

(10) WCurrently, where the number of allowances in circulation is above the established upper threshold, an amount of allowances corresponding to a given percentage of these allowances is deducted from the volumes of allowances to be auctioned and placed in the reserve. Meanwhile, a corresponding number of allowances is released from the reserve to Member States, and added to the volumes of the allowances to be auctioned, if the total number of allowances in circulation falls below the established lower threshold.

Amendment 43 #

Proposal for a decision
Recital 10 a (new)

(10a) To ensure that efficient decarbonisation of ETS sectors is incentivised, rather than just contributing to the increase of excessive prices, the market stability reserve should be responsive and function so that disturbances in the market and unnatural or disproportionate increases in carbon price or deficiencies in allowances circulating are addressed and corrected immediately.

Amendment 44 #

Proposal for a decision
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 45 #

Proposal for a decision
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. Such an adjustment was necessary in order to ensure that the EU ETS remains fit for purpose and resilient. __________________ 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 46 #

Cristian-Silviu BUŞOI

Proposal for a decision
Recital 12 a (new)

(12a) Any review and adjustment to the market stability reserve should aim to minimize regulatory complexity and market speculation, while ensuring a maximum degree of market predictability and fitness of the EU ETS in line with the Union’s increased climate ambition for 2030.

Amendment 47 #

Proposal for a decision
Recital 13

(13) The review paid particular attention to the percentage figure for the determination of the number of allowances to be placed in the reserve, as well as to the numerical value of the threshold for the total number of allowances in circulation and the number of allowances to be released from the reserveAccording to the Commission’s latest report on the market stability reserve, by 2022, operation of the reserve will cause there to be more allowances in the reserve than are circulating in the market.

Amendment 48 #

Proposal for a decision
Recital 14

Amendment 49 #

Proposal for a decision
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 In 2019, before the pandemic, the price of emission allowances stood at around EUR 25 per tonne. During 2021, these prices leapt from around EUR 30 to well over EUR 80. This trend does not appear to reflect a surplus of allowances, quite the contrary. These prices are severely harming the EU’s industrial fabric, which is also having to cope withe r~~eserve should also continue to be 200 million~~ising international natural gas prices.

Amendment 50 #

Alexandr VONDRA, Pietro FIOCCHI, Grzegorz TOBISZOWSKI, Jadwiga WIŚNIEWSKA, Andrey SLABAKOV

Proposal for a decision
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 th~~However, there is an uncontrolled price surge on the EU ETS market over the last year and a half, suggesting that a significant increase of allowances in the EU ETS is necessary. Furthermore, that analysis did not take min~~imum number of allowances to be placed in the reserve should also continue to be 200 millio~~to consideration the current energy crisis, which have led to sudden increases in energy prices for businesses and households in the Union. Therefore, any proposal to continue the doubled uptake rates beyond 2023 should not be pursued until the energy prices become stable and affordable again.

Amendment 51 #

Proposal for a decision
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 millio~~However, that analysis did not take into account the current energy crisis, which have led to sudden increases in energy prices for businesses and households in the Union. Therefore, any proposal to continue the doubled uptake rates beyond 2023 should not be pursued until the energy prices become stable and affordable again.

Amendment 52 #

Proposal for a decision
Recital 14

Amendment 53 #

Proposal for a decision
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~~not revert under the current level.

Amendment 54 #

Emma WIESNER, Jan HUITEMA, Billy KELLEHER, Claudia GAMON, Pascal CANFIN

Proposal for a decision
Recital 14

Amendment 55 #

Proposal for a decision
Recital 14 a (new)

(14a) From 2018 to 2019, when the reserve began operating, the surplus of allowances fell significantly from 1,65 billion to around 1,385 billion allowances. In 2020, due to lower demand as a result of economic slowdown caused by the COVID-19 pandemic, the surplus increased to 1,579 billion allowances. With new variants emerging and governments posing new restrictions effecting economic activities, it is unclear how the reserve can absorb the surplus under the current rules during the coming years. In addition, Germany, Slovenia and Czechia have recently announced plans hastening the phase out of coal, creating a possibility of additional supply of allowances to the market. These decisions can be followed by other Member States in the future.

Amendment 56 #

Proposal for a decision
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)

(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 58 #

Alexandr VONDRA, Pietro FIOCCHI, Grzegorz TOBISZOWSKI, Jadwiga WIŚNIEWSKA, Andrey SLABAKOV

Proposal for a decision
Recital 15

Amendment 59 #

Proposal for a decision
Recital 15

(15) IfOn the ~~rate of the total number of allowances in circulation to be placed in the reserve each year reverts to 12 % after 2023, a potentially harmful surplus of allow~~contrary, for the moment it is better to use the allowances in the reserve to counteract high prices and also address existing structural imbalances ion 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 incsupply side of allowances faced by some Member States. Consequently, the allowances in the rease~~d climate ambition for 2030 to ensure market predictability~~rve should not be cancelled.

Amendment 60 #

Proposal for a decision
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 ~~potentially~~significant 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 61 #

Emma WIESNER, Jan HUITEMA, Billy KELLEHER, Claudia GAMON, Pascal CANFIN

Proposal for a decision
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 potentially 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 predictability.~~ its timely entry into force and thereby provide market predictability by eliminating the risk that the rate falls back below 24 %. This is without prejudice to further revisions of the reserve, including if appropriate of the rate of allowances to be placed in the reserve, as part of the general revision of Directive 2003/87/EC and Decision (EU) 2015/1814 taking place in 2022.

Amendment 62 #

Proposal for a decision
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 potentially harmful~~is substantially decreased, using the allowances in the reserve would enable to counteract the disproportionately and unnaturally frequency of high price increases and also address existing structural imbalances on the surpplusy side of allowances ~~in the EU ETS may disturb market stability~~faced by some Member States. In addition, the rate ~~of 24 %~~ after 2023 ~~should~~may be established separately from the general review of Directive 2003/87/EC and Decision (EU) 2015/1814 to ~~strengthen~~address inconsistencies of the EU Emissions Trading System in line with the Union’s increased climate ambition for 2030 to ensure market predictability, and as such, the allowances in the reserve should not be cancelled.

Amendment 63 #

Proposal for a decision
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 potentially harmful surplus of allowances in the EU ETS may disturb market stability and jeopardise the achievement of greenhouse gas emission reductions in line with legally binding climate targets, as reflected in the impact assessment that was carried out. 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 predictability.

Amendment 64 #

Proposal for a decision
Recital 15

Amendment 65 #

Proposal for a decision
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 ~~potentially harmful surplus of allowances in the EU ETS may disturb~~share of the allowances in the reserve can contribute to greater market stability. ~~In addition, the~~A rate of 24 % after 2023 shcould be established ~~separately from the general~~, taking into account the results of the 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 predictability.

Amendment 66 #

Proposal for a decision
Recital 15 a (new)

(15a) The post-2023 rules of the reserve should be further scrutinized under the Commission's proposal for a Directive of the European Parliament and of the Council amending Directive 2003/87/EC establishing a system for greenhouse gas emission allowance trading within the Union, Decision (EU) 2015/1814 concerning the establishment and operation of a market stability reserve for the Union greenhouse gas emission trading scheme and Regulation (EU) 2015/757. The functioning of the reserve and EU ETS should be aligned with the ambition enshrined in Regulation (EU) 2021/1119 and the Paris Agreement, while reflecting equity and the principle of common but differentiated responsibilities and respective capabilities, in the light of different national circumstances.

Amendment 67 #

Proposal for a decision
Recital 15 a (new)

(15a) The EU ETS generates non- negligible revenues for Member States’ budgets, as the majority of auction revenues go to the Member States. Maintaining the rate of allowances placed in the market stability reserve will reduce the quantity of allowances that are auctioned and may therefore have budgetary implications in this respect. However, it can be expected that this reduction will be offset, on the one hand, by the price impact caused by the reduction in surplus allowances due to the increased objectives of the EU ETS and, on the other hand, by the anticipated inclusion of maritime transport, road transport and buildings in the EU ETS.

Amendment 68 #

Proposal for a decision
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 69 #

Antoni COMÍN I OLIVERES

Proposal for a decision
Recital 15 a (new)

(15a) The rate of 36 % after 2023 should be established separately from the general review of Directive 2003/87/EC and Decision (EU) 2015/1814 to strengthen the EU ETS in line with the Union’s increased climate ambition for 2030 to ensure that there is market predictability.

Amendment 70 #

Proposal for a decision
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 71 #

Javi LÓPEZ, César LUENA, Nicolás GONZÁLEZ CASARES, Marcos ROS SEMPERE, Estrella DURÁ FERRANDIS

Proposal for a decision
Recital 16

~~(16) Decision (EU) 2015/1814 should therefore be amended accordingly,~~deleted

Amendment 72 #

Proposal for a decision
Recital 16

(16) Decision (EU) 2015/1814 should therefore be amended accordingly, However, within six months of entry into force of the proposal for a directive amending Directive 2003/87, the Commission shall conduct an assessment of its impact on the supply of and demand for allowances in the market and submit a new proposal to amend Article 1(5) of Decision (EU) 2015/1814, if necessary in view of the results of that assessment.

Amendment 73 #

Salvatore DE MEO, Aldo PATRICIELLO, Fulvio MARTUSCIELLO, Luisa REGIMENTI

Proposal for a decision
Article 1

Decision (EU) 2015/1814
Article 1 – paragraph 5 – subparagraph 1

Amendments to Decision (EU) 2015/1814 In Article 1(5), first subparagraph, of Decision (EU) 2015/1814, the last sentence is replaced by the following: ‘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 doubled.’rticle 1 deleted

Amendment 74 #

Proposal for a decision
Article 1

Decision (EU) 2015/1814
Article 1 – paragraph 5 – subparagraph 1

Amendments to Decision (EU) 2015/1814 In Article 1(5), first subparagraph, of Decision (EU) 2015/1814, the last sentence is replaced by the following: 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 doubled.rticle 1 deleted

Amendment 75 #

Adam JARUBAS

Proposal for a decision
Article 1

Decision (EU) 2015/1814
Article 1 – paragraph 5 – subparagraph 1

Amendment 76 #

Alexandr VONDRA, Pietro FIOCCHI, Grzegorz TOBISZOWSKI, Jadwiga WIŚNIEWSKA, Andrey SLABAKOV

Proposal for a decision
Article 1

Decision (EU) 2015/1814
Article 1 – paragraph 5 – subparagraph 1

Amendment 77 #

Marek Paweł BALT

Proposal for a decision
Article 1

Decision (EU) 2015/1814
Article 1 – paragraph 5 – subparagraph 1

Amendment 78 #

Proposal for a decision
Article 1

Decision (EU) 2015/1814
Article 1 – paragraph 5 – subparagraph 1

Amendment 79 #

Proposal for a decision
Article 1 – paragraph 1

Decision (EU) 2015/1814
Article 1 – paragraph 5 – subparagraph 1

In Article ~~1(5), first subparagraph, of Decision (EU) 2015/1814, the last sentence is replaced by the following: ‘By way of derogation from the first and second sentences,~~ 3 of Regulation (EU) 2015/1814, the following is added: ‘Six months after the adoption of the revision to Directive 2003/87/EC, the Commission may propose a revision of this Decision to amend the rates set out in the first subparagraph of Article 1(5). To that end, the Commission shall analyse the expected functi~~l 31 December 2030, the percentages and th~~oning of the European carbon market and a projection of the functioning of the reserve based on the new parameters for Directive 1200 ~~mill~~3/87/EC. The Commission shall~~owances~~ analyse the refser~~red to in those sent~~ve’s effects on growth, employment, the Union’s industrial competitivences ~~shall be doubled~~s and the risk of carbon leakage, including a new carbon border adjustment mechanism.’

Amendment 80 #

Alexandr VONDRA, Pietro FIOCCHI, Grzegorz TOBISZOWSKI, Jadwiga WIŚNIEWSKA, Andrey SLABAKOV

Proposal for a decision
Article 1 – paragraph 1

Decision (EU) 2015/1814
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 ~~doub~~tripled.

Amendment 81 #

Proposal for a decision
Article 1 – paragraph 1 a (new)

Decision (EU) 2015/1814
Article 1 – paragraph 5 a

In Article 1, paragraph 5a is deleted.

Amendment 82 #

Proposal for a decision
Article 1 – paragraph 1 a (new)

Decision (EU) 2015/1814
Article 1 – paragraph 5 a

~~(https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A02015D1814-~~In Article 1, paragraph 5a is deleted. Or. en 20180408&qid=1642503924151)

Amendment 83 #

Edina TÓTH

Proposal for a decision
Article 1 – paragraph 1 a (new)

Decision (EU) 2015/1814
Article 1 – paragraph 5 a

In Article 1, paragraph 5a is replaced by the following: "5a. Unless otherwise decided in the first review carried out in accordance with Article 3, from 2023 allowances held in the reserve above ~~the total number of allowances auctioned during the previous year shall no longer be valid. (https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A02015D1814-~~2 000 million allowances shall no longer be valid.” Or. en 20180408&qid=1642503924151)

Amendment 84 #

Alexandr VONDRA, Pietro FIOCCHI, Grzegorz TOBISZOWSKI, Jadwiga WIŚNIEWSKA, Andrey SLABAKOV

Proposal for a decision
Article 1 – paragraph 1 b (new)Decision (EU) 2015/1814

Article 1 – paragraph 6

In Article 1, paragraph 6 is replaced by the following: 6. In any year, ifeach time the total number of allowances in circulation is less than 400 million or the clearing price of allowances in the auctions carried out in accordance with the delegated acts adopted under Article 10(4) of Directive 2003/87/EC surpass 40 EUR, 100 million allowances shall be released from the reserve and added to the volume of allowances to be auctioned by the Member States under Article 10(2) of Directive 2003/87/EC. Where fewer than 100 million allowances are in the reserve, all allowances in the reserve shall be released under this paragraph. Or. en (https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A02015D1814- 20180408&qid=1642503924151)

Amendment 85 #

Proposal for a decision
Article 1 – paragraph 1 b (new)

In Article 1, paragraph 6 is replaced by the following: 6. In any year, if the total number of allowances in circulation is less than 400 million or the clearing price of allowances in the auctions carried out in accordance with the delegated acts adopted under Article 10(4) of Directive 2003/87/EC surpass 80 EUR, 100 million allowances shall be released from the reserve and added to the volume of allowances to be auctioned by the Member States under Article 10(2) of Directive 2003/87/EC. Where fewer than 100 million allowances are in the reserve, all allowances in the reserve shall be released under this paragraph. ~~(https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A02015D1814-~~Or. en 20180408&qid=1642503924151)

Amendment 86 #

Eric ANDRIEU

Proposal for a decision
Article 1 – paragraph 1a (new)

Decision (EU) 2015/1814
Article 1 – paragraph 7 a (new)

In Article 1, the following paragraph is inserted: 7a. Where, for more than three consecutive months, the average price of allowances in the auctions is more than 150 % of the average price of allowances during the six preceding consecutive months in the auctions for the allowances, the Commission shall, as a matter of urgency, adopt a decision to release up to 100 million allowances from the market stability reserve to be added to the volumes of the allowances to be auctioned.

Amendment 87 #

Proposal for a decision
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 of~~evaluate 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 interval~~in 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.'

Amendment 88 #

Proposal for a decision
Article 1 a (new)Directive 2003/87/EC

Article 10 – paragraphs 1 a a and 1 a b and 1 a c (new)

~~(https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A02003L0087-~~Article 1a Amendments to Directive 2003/87/EC In Article 10, the following paragraphs are inserted: ‘1aa. Starting from 2024, Member States with a deficit of allowances in any year in the period after 2023 shall have their allowances exempted from the operation of the market stability reserve in the following year up to the amount of their deficit in the previous year. 1ab. For Member States with structural imbalance of allowances that persists even after the exemption from the operation of the market stability reserve in the following year, the allowances in the market stability reserve shall be used to cover this imbalance. This shall be done by comparing the total number of allowances for the beneficiary Member State against the emissions generated in the sectors covered by the EU ETS in the same year. For the purpose of this calculation, the total number of allowances shall take into account all allowances: (a) to be auctioned by particular Member States in accordance with Article 10 together with (b) the total number of allowances received for free by installations in this Member State in accordance with Article 10a, and (c) the national allocation from the Modernisation Fund for that Member State in accordance with Article 10d. 1ac. After establishing the level of deficit the national share of the Modernisation Fund shall be increased by the same amount or the Member State shall receive this amount of allowances from the market stability reserve allowances that would otherwise be cancelled in that year. Should this be insufficient to fully compensate the deficit in year n then the rest of it shall be covered by using allowances already placed in the market stability reserve to ensure a respective increase of the Modernisation Fund allocation for this Member State in year n+1.’. Or. en 20210101&qid=1642503235409)

Amendment 89 #

Proposal for a decision
Article 1 c (new)

Directive 2003/87/EC
Article 12 – paragraph 1 – introductory part

~~1. Member States shall ensure that allowances can be transferred between: (https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A02003L0087-~~Article 1c Amendments to Directive 2003/87/EC In Article 12(1), the introductory part is replaced by the following: “1. Without prejudice to Article 29b, Member States shall ensure that allowances can be transferred between:” Or. en 20210101&qid=1642503235409)

Amendment 90 #

Edina TÓTH

Proposal for a decision
Article 1 a (new)

Directive 2003/87/EC
Article 29 a

Article 1a Amendments to Directive 2003/87/EC Article 29a of Directive 2003/87/EC is replaced by the following: "Article 29a Measures in the event of excessive price fluctuations ~~1. If, for more than six consecutive~~If in a calendar months, the average allowance price on the European carbon market is more than t~~hree~~wo times the average price of allowances during the ~~two preceding years~~ five months period centred by the mon the European carbon market, the Commission shall immediately convene a meeting of the Committee established by Article 9 of Decision No 280/2004/EC. 2. If the price evolution referred to in paragraph 1 does not corresp two years prior to that month, 150 million allowances shall be automatically released from the market stability reserve established by Decision (EU) 2015/1814 and shall be auctioned according to Article 10 of this Directive during the second, t~~o changing market fundamentals, one of~~ hird and fourth monthes following measures may be adopted, taking into account the degree of price evolution: (a) States to bring forward the auctioning of a part of the quantity to be auctioned; (b) States to auction up to 25 % of the remaining allowances in the new entrants reserve. Those measures shall be adopted in accordance with the management procedure referred to in Article 23(4). 3. account of the reports submitted by the Commission to the European Parliament and to the Council pursuant to Article 29, as well as any othe month in which that criteria was met. The respective auctioning amounts for each of the three months shall be evenly distributed. If the amount of the allowances contained in the reserve is less than 150 million, all allowances in ther relevant information provided by Member States.4.The arrangements for the application of these provisions shall be laid down in the [acts] referred to in Article 10(4). (https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A02003L0087-serve shall be released. " a measure which allows Member a measure which allows Member Any measure shall take utmost Or. en 20210101&qid=1642503235409)

Amendment 91 #

Proposal for a decision
Article 1 b (new)

Directive 2003/87/EC
Article 29 a

Article ~~29a Measures in the event of excessive price fluctuations 1. If, for more than six consecutive months, the allowance price is more than three times~~1b Amendments to Directive 2003/87/EC Article 29a is replaced by the following: "Article 29a Measures in the event of excessive price fluctuations The Commission shall convene a meeting not later than within 7 working days of the Committee established by Article 9 of Decision No 280/2004/EC, if: (a) for two consecutive months or more, the monthly average allowance price reaches twice or more the average price of allowances during the preceding two and a half year period on the European carbon market, or (b) over the course of a year, the monthly average allowance price has risen twice or more than the average price of allowances during the ~~two~~ preceding ~~years~~two- year period on the European carbon market, the Commission shall immediately convene a meeting of the Committee established by Article 9 of Decision No 280/2004/EC. 2. If the price evolution referred to in paragraph 1 does not correspond to changing market fundamentalsor (c) there is a sudden spike in the allowance price that reaches 50 % higher than its average price of allowances in the preceding three months. 2. For the purposes of paragraph 1: (a) the “monthly average carbon price” for any month is calculated by dividing the sum of the settlement prices of the relevant December futures contract as traded on the relevant carbon market exchange for each relevant day in the month by the number of relevant days in the month. (b) the “average price of allowances during the two preceding years period” is calculated by dividing the sum of the settlement prices of the relevant December futures contract as traded on the relevant carbon market exchange for each relevant day in the two year period ending with the last month before the first month of the period of three consecutive months by the number of relevant days in the two year period. 3. If the price evolution referred to in paragraph 1 is triggered, one of the following measures ~~may be adop~~shall be implemented, taking into account the degree of price evolution: (a) a measure which allows Member States to bring forward the auctioning of a part of the quantity to be auctioned in a subsequent calendar year; (b) a measure which allows Member States to release for auction up to 25 % of the remaining allowances in the new entrants reserve. Those measures shall be adopted in accordance with the management procedure referred to in Article 23(4). 3. Any measure shall take utmost account of the reports submitted by the Commission to the European Parliament and to the Council pursuant to Article 29, as well as any other relevant information provided by Member States.4.The arrangements for the application of these provisions shall be laid down in the [acts] referred to in Article 10(4). (https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A02003L0087-; (c) the release of an appropriate quantity of allowances from the market stability reserve. The Committee may also consider additional interventions if the circumstances justify further or earlier action. Or. en 20210101&qid=1642503235409)

Amendment 92 #

Miapetra KUMPULA-NATRI, Marek Paweł BALT, Csaba MOLNÁR, Nora MEBAREK, Carlos ZORRINHO, Łukasz KOHUT

Proposal for a decision
Article 1 c (new)Directive 2003/87/EC

Article 29 b (new)

Article 1c Amendments to Directive 2003/87/EC The following Article is inserted: Article 29b (new) 1. The access to the EU ETS market shall be limited to entities that are installations, aviation and maritime operators with compliance obligations under the EU ETS. 2. Financial intermediaries purchasing allowances on account of the entities referred to in paragraph 1 and not their own may be an exception. 3. The quantity of EU ETS allowances purchased during auctions by financial intermediaries shall not exceed what is reasonably needed to fulfil their contractual obligations towards entities referred to in paragraph 1. 4. Article 6(5) of Commission Regulation (EU) No 1031/2010 should be adjusted in accordance with paragraphs 1 and 2. Or. en (https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A02003L0087- 20210101&qid=1642503235409)

source: 704.569

2022/02/01 ITRE 29 amendments...

Amendment 10 #

Proposal for a decision
Recital 1 b (new)

(1b) The need for urgent action is further intensified by the increase in the frequency and intensity of extreme weather conditions as a direct result of climate change. According to the United Nations Office for Disaster Risk Reduction, the number of disasters recorded worldwide and the scale of global economic losses have nearly doubled in the last 20 years, much of which increase corresponds to the significant rise in the number of climate related disasters.

Amendment 11 #

Miapetra KUMPULA-NATRI, Marek Paweł BALT, Csaba MOLNÁR, Nora MEBAREK, Carlos ZORRINHO, Łukasz KOHUT

Proposal for a decision
Recital 1 c (new)

(1c) The Union should therefore address this urgency by stepping up its efforts and establishing itself as an international leader in the fight against the climate change.

Amendment 12 #

Miapetra KUMPULA-NATRI, Marek Paweł BALT, Csaba MOLNÁR, Nora MEBAREK, Carlos ZORRINHO, Łukasz KOHUT

Proposal for a decision
Recital 3

(3) The European Green Deal combines a comprehensive set of mutually reinforcing measures and initiatives aimed at achieving climate neutrality in the EU by 2050, and sets out a new growth strategy that aims to transform the Union into a fair and prosperous society, with a modern, resource-efficient and competitive economy, where economic growth is decoupled from resource use. It also aims to protect, conserve and enhance the Union's natural capital, and protect the health and well-being of citizens from environment-related risks and impacts. At the same time, this transition affects workers from various sectors, women and men differently and has a particular impact on some disadvantaged groups, such as older people, persons with disabilities and persons with a minority racial or ethnic background. It must therefore be ensured that ~~the transition is just and~~it includes just transition of workforce and it is inclusive, leaving no one behind.

Amendment 13 #

Miapetra KUMPULA-NATRI, Marek Paweł BALT, Csaba MOLNÁR, Nora MEBAREK

Proposal for a decision
Recital 3 a (new)

(3a) Research and innovation will greatly contribute to achieve the ambitious goals of the ‘European Green Deal’, to make Europe the world's first climate-neutral economic area by 2050 and to transform climate and environmental challenges into opportunities. There is an urgent need for investment in innovation aiming to bring to market industrial solutions and zero- carbon technologies to decarbonise Europe and support its transition to climate neutrality. In particular, the Innovation Fund should focus on highly innovative technologies and supporting businesses, in particular SMEs, to create local, decent and future-proof jobs and reinforce European technological leadership on a global scale.

Amendment 14 #

Marc BOTENGA, Giorgos GEORGIOU, Sira REGO, Cornelia ERNST

Proposal for a decision
Recital 5

(5) The Union committed to reduce the Union’s economy-wide net greenhouse gas emissions by at least 55 % by 2030 below 1990 levels in the updated nationally determined contribution submitted to the UNFCCC Secretariat on 17 December 202028 . , remaining below the science- based target of the Paris Agreement of at least 65% of reduction necessary in order to limit global warming to 1.5°C degrees. _________________ 28 https://www4.unfccc.int/sites/ndcstaging/P ublishedDocuments/European %20Union %20First/EU_NDC_Submission_Decembe r %202020.pdf

Amendment 15 #

Miapetra KUMPULA-NATRI, Nora MEBAREK, Carlos ZORRINHO, Łukasz KOHUT

Proposal for a decision
Recital 8

(8) In order to address the structural imbalance between supply and demand of allowances in the market, which threatened to weaken the EU ETS through lower carbon prices leading to fewer incentives for the long investment cycles of energy and industry investors for GHG- emission reductions, 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 16 #

Marc BOTENGA, Giorgos GEORGIOU, Sira REGO, Cornelia ERNST

Proposal for a decision
Recital 8

(8) In order to address the structural imbalance between supply and demand of allowances in the market, 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, highlighting the structural imbalance of the ETS system and its inability to ensure sufficient emission reductions. _________________ 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 17 #

Othmar KARAS, Gheorghe FALCĂ, Angelika WINZIG, Christian EHLER, Cristian-Silviu BUŞOI, Ioan-Rareş BOGDAN, Angelika NIEBLER, Jerzy BUZEK, Seán KELLY, Maria da Graça CARVALHO, Eva MAYDELL, Pernille WEISS

Proposal for a decision
Recital 8 a (new)

(8a) To effectively align emissions trading with the 2030 climate targets, strengthen the ETS resilience to price shocks, and increase planning certainty for the development of and investment in decarbonisation technologies, ad hoc interventions in the market stability reserve must be carefully scrutinized and where possible avoided.

Amendment 18 #

Jerzy BUZEK, Marian-Jean MARINESCU, Adam JARUBAS, Janusz LEWANDOWSKI

Proposal for a decision
Recital 10 a (new)

(10a) It has been observed that the delay between the publication of the total number of allowances in circulation and the start of the period where allowances are placed in the market stability reserve by deducting certain quantities from the volume of allowances to be auctioned, currently of three and a half months, incentivises a speculative behaviour leading to an artificial increase of prices of allowances. This delay should therefore be reduced to one month and a half.

Amendment 19 #

Proposal for a decision
Recital 12 a (new)

(12a) Any review and adjustment to the market stability reserve should aim to minimize regulatory complexity and market speculation, while ensuring a maximum degree of market predictability and fitness of the EU Emissions Trading System in line with the Union’s increased climate ambition for 2030.

Amendment 20 #

Proposal for a decision
Recital 13

(13) ~~The review paid particular attention to the percentage figure for the determination of~~According to the latest Commission report regarding the stability reserve, its functioning will lead to the situation that in 2022 the number of allowances ~~to be placed~~ in the reserve~~, as~~ weill ~~as to the numerical value of the threshold for the total~~be greater than the number of allowances in circulation ~~and~~in the ~~number of allowances to be released from the reserve~~market.

Amendment 21 #

Proposal for a decision
Recital 14

Amendment 22 #

Claudia GAMON, Emma WIESNER, Iskra MIHAYLOVA, Atidzhe ALIEVA-VELI, Ilhan KYUCHYUK, Christophe GRUDLER

Proposal for a decision
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 thIn 2019, before the start of the pandemic, the price of allowances was approximately EUR 25 per tonne. During 2021 these prices have reise~~rve each year after 2023 is insufficient~~n sharply and exceeded EUR 80 per tonne. This evolution does not seem to pre~~vent a significant increase of the~~flect a surplus of allowances inand the ~~EU ETS. Therefore, after 2023 the percentage figure should continue to be 24 %, and the minimum number of allowan~~se prices are having very negative consequences on the industrial fabric of the EU, which must also faces t~~o be placed in the reserve should also continue to be 200 million~~he rise in international natural gas prices.

Amendment 23 #

Proposal for a decision
Recital 14

Amendment 24 #

Claudia GAMON, Emma WIESNER, Iskra MIHAYLOVA, Atidzhe ALIEVA-VELI, Ilhan KYUCHYUK, Christophe GRUDLER

Proposal for a decision
Recital 14 a (new)

(14a) According to the 2021 Carbon Market Report, the total number of allowances in circulation has increased in 2020 to 1579 billion allowances, compared to 1385 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. Studies suggest that, due to the increased EU 2030 climate target and the recent coal phase-out announcements from several Member States, keeping the intake rate at 24% until 2030 would only allow to prevent a new surplus to be generated but would not be sufficient to further reduce the historical surplus already accumulated in the market.2a _________________ 2aStructural Supply Side Management in the EU ETS. Study of German Environment Agency (2021)

Amendment 25 #

Proposal for a decision
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 potentially 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 predictability~~its timely entry into force and thereby provide market predictability by eliminating the risk that the rate falls back below 24%. This is without prejudice to further revisions of the reserve, including if appropriate of the rate of allowances to be placed in the reserve, as part of the general revision of Directive 2003/87/EC and Decision (EU) 2015/1814 taking place in 2022.

Amendment 26 #

Proposal for a decision
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 ~~potentially~~ harmful surplus of allowances in the EU ETS ~~may~~will continue to disturb market stability. ~~In addition, the rate of 24 % after 2023 should be established~~ Therefore, in order to ensure that the EU ETS is fit for purpose, the intake rate should be increased to 36% as of 2024. That decision should be taken separately from the on-going 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 predictability~~in order to ensure market predictability. The environmental integrity of the reserve, including the intake rate, could be further increased in the context of that general review.

Amendment 27 #

Proposal for a decision
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 potentially harmful~~part of the surplus of allowances in the ~~EU ETS may disturb~~reserve could contribute to providing greater market stability. ~~In addition, the~~A rate of 24 % after 2023 shcould be established ~~separately from~~taking into account the results of 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 predictability.

Amendment 28 #

Nicolás GONZÁLEZ CASARES, Adriana MALDONADO LÓPEZ, Lina GÁLVEZ, Alicia HOMS GINEL

Proposal for a decision
Recital 15 a (new)

(15a) The Commission should continuously monitor the functioning of the reserve. When Commission finds out that the total number of allowances in circulation has increased compared to the previous year, it should make a legislative proposal to amend this Regulation to ensure the proper functioning of the reserve in rapidly and steadily absorbing the structural imbalance between supply and demand of allowances in the market.

Amendment 29 #

Proposal for a decision
Recital 16

(16) Decision (EU) 2015/1814 should therefore be amended accordingly,. However, in the six months following the entry into force of the directive amending Directive 2003/87/EC, the Commission must carry out an assessment on its impact on supply and demand for emissions allowances on the market and must put forward a fresh proposal to amend Article 1(5) of Decision (EU) 2015/1814 on a market stability reserve, if necessary, in the light of the results of that assessment.

Amendment 30 #

András GYÜRK, Ernő SCHALLER-BAROSS

-1 In Article 1, paragraph 5a is replaced by the following: "5a. Unless otherwise decided in the first review carried out in accordance with Article 3, from 2023 allowances held in the reserve above ~~the total number of allowances auctioned during the previous year shall no longer be valid. (https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A02015D1814-~~2000 million allowances shall no longer be valid." Or. en 20180408&qid=1642503924151)

Amendment 31 #

Proposal for a decision
Article 1 – paragraph 1 – introductory part

In Article ~~1(5), first subparagraph,~~3 of Decision (EU) 2015/1814, the ~~last sentence is replaced by the following~~following text is added:

Amendment 32 #

Jerzy BUZEK, Adam JARUBAS, Marian-Jean MARINESCU, Massimiliano SALINI, Markus PIEPER, Janusz LEWANDOWSKI

Proposal for a decision
Article 1 – paragraph 1

Decision (EU) 2015/1814
Article 1 – paragraph 5 – subparagraph 1a

~~By way of derogation from the first and second sentences, until 31 December 2030, the percentages and the 100 mill~~"Six months after the approval of the revision of Directive 2003/87/EC the Commission may propose a revision of this decision to modify the percentages of article 1, paragraph 5, first paragraph. For this review, the Commission shall analyse the foreseeable operation of the European carbon market and a projection of the operation of the reserve based on the new parameters of Directive 2003/87/EC. The Commission shall~~owances referred to in those sentences shall be doubled~~ evaluate the effects of the reserve on economic growth, employment, industrial competitiveness of the Union and the risk of carbon leakage, including the new Border Adjustment Mechanism".

Amendment 33 #

Proposal for a decision
Article 1 – paragraph 1

Decision (EU) 2015/1814
Article 1 – paragraph 5 – subparagraph 1a

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 doubled, if during the preceding year period on the European carbon market the average allowance price is lower than EUR 30.

Amendment 34 #

András GYÜRK, Ernő SCHALLER-BAROSS

Proposal for a decision
Article 1 – paragraph 1

Decision (EU) 2015/1814
Article 1 – paragraph 5 – subparagraph 1a

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 ~~doub~~tripled.

Amendment 35 #

Proposal for a decision
Article 1 a (new)

Directive 2003/87/EC
Article 29a

Article 1 a (new) Amendments to Directive 2003/87/EC Article 29a of Directive 2003/87/EC is replaced by the following: "Article 29a Measures in the event of excessive price fluctuations ~~1.If, for more than six consecutive~~If in a calendar months, the average allowance price on the European carbon market is more than t~~hree~~wo times the average price of allowances during the ~~two preceding years~~ five months period centred by the mon the European carbon market, the Commission shall immediately convene a meeting of the Committee established by Article 9 of Decision No 280/2004/EC. 2. If the price evolution referred to in paragraph 1 does not corresp two years prior to that month, 150 million allowances shall be automatically released from the market stability reserve established by Decision (EU) 2015/1814 and shall be auctioned according to Article 10 of this Directive during the second, t~~o changing market fundamentals, one of~~ hird and fourth monthes following ~~measures may be adopted, taking into account~~the month in which that criteria was met. The respective auctioning amounts for each of the ~~deg~~three of price evolution: (a)a measure which allows Member States to bring forward the auctioning of a part of the quantity to be auctioned; (b)a measure which allows Member States to auction up to 25 % of the remaining allowances in the new entrants reserve. Those measures shall be adopted in accordance with the management procedure referred to in Article 23(4). months shall be evenly distributed. If the amount of the allowances contained in the reserve is less than 150 million, all allowances in the reserve shall be released." Or. en (https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A02003L0087- 20210101&qid=1642503235409)

Amendment 7 #

Robert ROOS

Proposal for a decision
–

The Committee on Industry, Research and Energy calls on the Committee on Environment, Public Health and Food Safety, as the committee responsible, to propose rejection of the 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.

Amendment 8 #