Climate Action

Commission to decide on industrial free allocation for phase three in September

Tube with smoke on winter sunset © Zoonar

The European Commission plans to adopt a decision on Member States' national implementation measures (NIMs) for phase three of the EU ETS during the course of September 2013. The date of the adoption and publication of the decision will be announced on this website at least 24 hours in advance.

The Commission is currently scrutinising the NIMs. Thanks to the collaboration of Member States this work is nearing completion.

The decision will not only comprise the results of the NIMs scrutiny process but also lay down the size of any cross-sectoral correction factor needed. EU ETS rules foresee that a cross-sectoral correction factor should be applied if the preliminary allocation for industrial installations through NIMs exceeds the maximum amount of allowances available. In this case, free allocation to all industrial installations across the EU would be reduced by the same proportion.

The decision will also fix the final EU ETS cap for phase three.

Following adoption of the decision it will be for respective Member States' registry authorities to take the necessary steps to distribute the free allowances to installations. The Commission estimates that this will take around one to three months depending on the procedures to be applied in each Member State. It will also depend on whether the Commission decision requires changes to the preliminary allocations in the NIMs.

The decision on free allocation for 2013 may also require a change in the number of allowances to be auctioned. Once the decision is adopted the Commission will examine whether this is the case. If so it will be assessed and decided, together with Member States and auction platforms as well as in line with relevant provisions in the Auctioning Regulation, whether any adjustment to the volume to be auctioned should be made to the 2013 auction calendars or taken into account in the 2014 auction calendars.