Hinweis Cookies
Cookies help us to provide our services. By using our website you agree that we can use cookies. Read more about our Privacy Policy and visit the following link: Privacy Policy
Emissions trading: Federal Environment Agency interpretation of law confirmed once again
Porosifying agents and organic components in clay do not promote emissions
Year of issue
Date 27/11/2006
Date 27/11/2006
Another point of contention concerning the allocation of free emissions certificates for the greenhouse gas carbon dioxide (CO2) in the first trading period has been settled. On 17 November 2006, the administrative court in Berlin ruled in several test cases that the emissions of carbon dioxide from certain combustion processes common in the ceramics industry are not acknowledged as process-related emissions. Prof. Dr. Andreas Troge, President of the Federal Environment Agency (UBA), said, “The court has thereby reconfirmed the practices of the German Emissions Trading Authority (DEHSt) at the Federal Environment Agency.”
As laid down explicitly by the law, in its allocation procedure to award free emissions certificates, DEHSt considers emissions to be “process-related” if they issue from chemical reactions other than combustion. Efficiency measures can do relatively little to reduce emissions in the production process. These emissions are therefore not subject to a reduction obligation. 55 suits were filed against this allocation practice of DEHSt. The administrative court in Berlin handled 23 of them as test cases which have now been thrown out. The plaintiffs are operators of ceramic product plants who sought to obtain an additional larger share of emissions certificates for the years 2005-2007. They demanded from DEHSt an exceptional ruling applicable for their sector by which emissions from the use of so-called porosifying agents and the organic carbon in clay would be acknowledged as process-related. Both components burn into carbon dioxide as a product of combustion in the manufacturing process. DEHSt Director Hans-Jürgen Nantke said, “The objective of emissions trading must be to make it a manageable and efficient instrument of climate protection in Europe, and a multitude of special regulations is counterproductive.”
So-called porosifying agents are combustible materials such as wood shavings or polystyrene pellets which are used as additives in the production of bricks. The firing process produces gas that makes the bricks porous and improves their properties as insulation material. If carbon dioxide emissions from porosifying agents and the organic combustible components of clay are classified as “energy-related”, such as DEHSt has done and which the court has now corroborated, then DEHSt may also subject these emissions to an additional reduction obligation.
The reasons for the court’s judgement are not yet known, but it is assumed that appeals will be heard.
Emissions trading in the EU started in 2005. By the end of 2004 DEHSt had allocated emissions allowances to some 1,850 industrial operators in Germany. By allocating certificates for the entire 2005-2007 trading period and introducing a market-based environmental instrument, a number of legal questions have been raised which are now being settled in court. Legal issues already arose as a result of the differentiated treatment of industrial vs energy-industry processes, for there is greater technical reduction potential in combustion processes of energy conversion than in manufacture of industrial products. This is why emissions trading has imposed reduction obligations for energy-related emissions but not for those which are process-related.