The competitiveness of Energy Intensive Industries and the European ETS

Thursday, July 16, 2015

Energy Intensive Industries, including the chlorine industry, are voicing concern about their capacity to remain competitive and attract investment in Europe following the publication of the Commission’s proposal for the reform of the EU Emissions Trading Scheme (ETS). We call on EU policy makers to ensure that the post-2020 carbon leakage provisions fully offset direct and indirect costs at the level of best performers with no cross sectoral correction factor

The Alliance of Energy Intensive Industries supports the fight against climate change and the Commission’s ambition to transform the EU into a competitive, low-carbon economy. Our industries play an instrumental role in delivering the technologies and solutions to reach that common goal.

The ETS is an important tool to be used in achieving this common ambition. However, the initial assessment is that the Commission proposals’ contents are inadequate. They elicit severe concern for energy intensive
industries as they undermine the EU’s own key priorities on investment, job creation and growth in Europe.

Energy intensive sectors are capital-intensive. A large part of their investments are geared towards energy efficiency, decarbonisation and emission reduction efforts, in full support of the Climate and Energy Package 2030. However, securing these investments and preventing them from leaking outside of the EU requires strong carbon leakage provisions.

The current Commission proposals fall short on this requirement. In particular, fixing the auction share means shrinking available free allocations for manufacturing industry. Under the proposed rules even Europe’s most carbon-efficient installations in exposed sectors would face significant direct and indirect carbon costs.

We call on the Council and the Parliament to reform the ETS system in such a way that the economy can resume growth and that the most carbon efficient undertakings are not incurring a carbon cost penalty. 

Notes for Editors: About AEII

The Alliance of Energy Intensive Industries represents over 30,000 European companies and four
million jobs in the EU. Our industries are at the core of the EU economy and the starting point of multiple value chains, such as the car industry, fuels, buildings, energy production, including renewable energies, food and drinks, and pharmaceuticals.

More information

For more information, please contact AEII’s members directly.