Climate Action

Emissions trading: emissions have decreased by 3.9% in 2018

04/06/2019

Emissions of greenhouse gases from all operators covered by the EU Emissions Trading System (EU ETS) have decreased by 3.9%[1] overall in 2018, as a result of 4.1% decrease of emissions from stationary installations and 3.9% increase of emissions from aviation.

The EU ETS covers more than 11 000 power plants and manufacturing installations in the 28 EU Member States and Iceland, Norway and Liechtenstein, as well as emissions from around 500 airlines flying between European airports.

The reduction of greenhouse gases emissions registered in 2018 took place in the context of a growing EU economy (EU 28 GDP growth of 2% in 2018[2]). The biggest reduction was achieved in the power sector reflecting the on-going decarbonisation where coal and gas-fired power production has been replaced by electricity from renewables.  Emissions from industry decreased by 0.7%, with some leaders in this reduction such as the production of nitric and of adipic acid (chemicals used for the production of fertilisers, synthetic fabrics and explosives).

Installations’ level of compliance with the EU ETS is very high: more than 99% of emissions covered by allowances from the total stationary installations reported emissions. Non-compliant installations are typically small.

Emissions from stationary installations decreased

Verified emissions of greenhouse gases reported for 2018 from stationary installations (power plants and manufacturing installations) amounted to 1.682 billion tonnes of CO2-equivalent in 2018[3]. They were 4.1% less in 2018 than in 2017.

Airlines' emissions continue to rapidly increase

Under the EU ETS Directive, all commercial aircraft operators and non-commercial aircraft operators with significant emissions are accountable for their emissions from flights within the European Economic Area (EEA)[4] in the period 2013-2023.

Verified emissions from aircraft operators amounted to 66.9 million tonnes of CO2-equivalent in 2018[1]. They were approximately 3.9% higher than the 64.4 million tonnes of CO2-equivalent in 2017. These emissions were covered in proportion of 53% by allowances acquired from auctions or other sectors, mainly contributing to reductions in the power sector. Aircraft operators received free allowances totalling 30.5 million tonnes, covering 45.5% of their emissions. A percentage of 1.5% of international credits covered the remaining emissions.

More than 500 aircraft operators reported, including more than 100 commercial aircraft operators based outside the EU, which operate flights within the EEA. Non-compliant operators are typically small or ceased operating in 2018.

Background

Under the EU ETS, all operators (stationary installations and airlines) were required to report their verified 2018 emissions by 31 March 2019 and to surrender a corresponding number of allowances by 30 April 2019. The verified emissions data was made publicly available on the European Union Transaction Log (EUTL) on 1 April 2019. The EUTL displays compliance data from 1 May 2019, with information on whether installations have complied with their obligation to surrender an amount of allowances equal to the previous year's verified emissions.

This year, no comparative calculation was done (i.e. approximation of the emissions for non-compliant operators) because the high level of compliance and the level of registering emissions rendered it unnecessary. Instead, the total emissions reported in 2017 and 2018 were compared, without adjustment [1].

The third period of the EU ETS began on 1 January 2013 and runs until 31 December 2020. The rules revising the EU ETS for the period 2021-2030 were adopted in 2018.

For more information:

NOTES:

[1] All emissions reported for 2018 as recorded in the European Union Transaction Log on 1 May 2019. It also takes into consideration the verified emissions from two stationary installations that surrendered allowances before 1 May 2019, but registered their verified emissions on 6 May 2019. They amount to 8,308,884 tonnes of CO2-equivalent.

[2] EUROSTAT gross domestic product (GDP) growth rate data available on 8 May 2019 (link).

[3] All emissions reported for 2018 as recorded in the European Union Transaction Log on 1 May 2019. It also takes into consideration the verified emissions from two stationary installations that surrendered allowances before 1 May 2019, but registered their verified emissions on 6 May 2019. They amount to 8,308,884 tonnes of CO2-equivalent.

[4] The limitation of the EU ETS to flights within the EEA from 2013 was agreed in Regulation No.421/2014 and extended by Regulation (EU) 2017/2392.