| New report: 14 power stations in Poland's application for free ETS CO2 emissions allowances are ineligible |
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16 January 2012, Warsaw For immediate release ClientEarth will today submit to the European Commission a report demonstrating that 14 planned fossil fuel power stations included in Poland's application for free CO2 emissions allowances do not qualify for them. ClientEarth is convinced that allocating free allowances to these projects would constitute a breach of EU law. The allowances are intended to smooth the transition to a low-carbon future but would in these cases simply support the development of new coal power. All the power plants presented in ClientEarth's report were included by the Polish government in its application for transitional free emissions allowances. The Polish government hopes that the European Commission will approve its plan to grant the power stations free allowances in a transitional period to full auctioning from 2013-2020. This would amount to giving free allowances to between 15,000 and 20,000 MW of planned new investment fossil fuel capacity under the EU ETS scheme which is intended to discourage such high carbon investment. "We are presenting the European Commission with evidence that these proposed new fossil fuel power plants in Poland had not initiated their investment process by the end of 2008 and most of them did not possess a final and binding GHG permit on time. We invite the Commission to take this data into account during its assessment of Poland's application and hope it will reject free allowances for ineligible installations. Granting them the right to such allowances would go against both the letter and the spirit of ETS" says Karla Hill, Director of Programmes at ClientEarth. The report presents two reasons why those new projects cannot be considered eligible for free allowances: In 14 of the 15 cases assessed, there is no evidence to demonstrate that the investment process for these projects had been physically initiated by the end of 2008, as required under the terms of the derogation from the new EU emissions trading scheme (ETS) auctioning rules; In 13 of the 15 cases, the projects did not have a final and binding greenhouse gas (GHG) permit by 30 June 2011 which is also a condition for free allowances. The European Commission is currently analysing the derogation applications submitted in September 2011 by Poland as well as seven other EU countries. It recently extended the deadline for all these countries to provide more information about their applications to 16 January 2012. The Commission's final decision on which installations can be granted free allowances is expected to be issued by mid-July. ENDS Media contact: Karla Hill | Director of Programmes | This e-mail address is being protected from spambots. You need JavaScript enabled to view it | +44 (0)207 749 5970 | m +447517369324 Notes to editors What makes the 14 power plants ineligible for allowances? ClientEarth's report Eligibility of proposed fossil-fuel power projects in Poland for transitional free allowances under the EU emissions trading scheme has been prepared on the basis of publically available data. The organisation has gathered evidence that 14 power plants, mostly coal-fired, included in the Polish derogation application did not possess a valid building permit by 31 December 2008 and there is no evidence that the investment process had been physically initiated as at this cut-off date. According to Poland's Building Law Act such a permit is necessary to initiate an investment process of a power plant including any preparatory works. At the same time the EU ETS scheme stipulates that only those unbuilt power plants whose investment process had been physically initiated by the end of 2008 can obtain free emissions allowances. This is to prevent investment decisions being influenced by the prospect of free allowances. Moreover, 13 of the new power plants did not have a final and binding GHG permit by the end of June 2011. All of them had been issued with the GHG permit by that date, but in most cases the GHG permits were still subject to pending administrative procedures so the GHG permits were not final and binding at that time. Read the executive summary of ClientEarth' s report. Draft Application for transitional free allocation of emission allowances is available in Polish at: http://www.kobize.pl/materialy/aktualnosci/KSW-20110831-1512.pdf |
