Estonia will implement a new scheme for emissions trading
The Government today approved the new scheme for greenhouse gas emissions trading, to be introduced alongside the market-based European emissions trading system (ETS).
While in the current trading system the obligations to reduce greenhouse gas emissions are imposed on the largest companies, engaged in energy and industrial production, the new emissions trading scheme of the European Union is based on different foundations – the obligation to reduce emissions is established for Member States who can then trade emission credits for more cost-efficient performance of their obligations.
The new emissions trading scheme concerns sectors, which are excluded from the European emissions trading system. These sectors include transport, agriculture, waste management, combustion plants with up to 20 MW of rated thermal input, as well as use of solvents and other similar products.
“The state has to ensure that emissions from these sectors do not exceed the annual limit. According to initial projections, Estonia is likely to have surplus credits during the period, which enables Estonia to earn millions of euros from the sale of credits; this would then be invested in the same sectors to reduce greenhouse gas emissions,” explained Mati Raidma, Minister of the Environment.
Estonia was allocated about 6.30 million credits for 2013 and this number will increase annually to about 6.47 million credits in 2020. One credit equals one ton of greenhouse gas emissions.
Implementation of this emissions trading scheme enables Member States to be more flexible and achieve greater cost-efficiency as they strive towards their emission reduction targets.