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Effort Sharing Decision

Policy

The Effort Sharing Decision establishes binding annual greenhouse gas emission targets for Member States for the period 2013–2020. These targets concern emissions from most sectors not included in the EU Emissions Trading System (EU ETS), such as transport, buildings, agriculture and waste.

The Effort Sharing Decision forms part of a set of policies and measures on climate change and energy – known as the climate and energy package - that will help move Europe towards a low-carbon economy and increase its energy security.

10% reduction of emissions from the Effort Sharing sectors

The Effort Sharing Decision sets national emission targets for 2020, expressed as percentage changes from 2005 levels. It also lays down how the annual emission allocations (AEAs) in tonnes for each year from 2013 to 2020 are to be calculated.

The national emission targets for 2020 (click on the table to enlarge it) have been agreed unanimously. They have been set on the basis of Member States’ relative wealth (measured by Gross Domestic Product per capita). They range from a 20% emissions reduction by 2020 (from 2005 levels) for the richest Member States to a 20% increase for the least wealthy one, Bulgaria. Croatia, which joined the EU on 1 July 2013, is allowed to increase emissions by 11%.

Less wealthy countries are allowed emission increases in these sectors because their relatively higher economic growth is likely to be accompanied by higher emissions. Nevertheless their targets represent a limit on their emissions compared with projected business as usual growth rates. A reduction effort is thus required by all Member States.

By 2020, the national targets will collectively deliver a reduction of around 10% in total EU emissions from the sectors covered compared with 2005 levels. Together with a 21% cut in emissions covered by the EU ETS, this will accomplish the overall emission reduction goal of the climate and energy package, namely a 20% cut below 1990 levels by 2020.

National action needed

In contrast to sectors in the EU ETS, which are regulated at EU level, it is the responsibility of Member States to define and implement national policies and measures to limit emissions from the sectors covered by the Effort Sharing Decision.

Examples of potential policies and measures include reducing transport needs, promotion of public transport, a shift away from transport based on fossil fuels, support schemes for retrofitting of the building stock, more efficient heating and cooling systems, renewable energy for heating and cooling, more climate-friendly farming practices, and conversion of livestock manure to biogas.

EU-wide measures will help

Coast

A number of measures taken at EU level will help Member States to reduce emissions. For example:

  • CO2 emission standards for new cars and vans will cut emissions from road transport;
  • Emission reductions from buildings will be aided by measures to improve the energy performance of buildings, eco-design requirements for energy–related products, and energy labelling systems to inform consumers;
  • Restrictions on fluorinated industrial gases (F-gases) and implementation of other EU environmental policies, e.g. on soil protection and waste, will also contribute to reaching the national targets.

Gases and sources

The Effort Sharing Decision covers the six greenhouse gases controlled by the Kyoto Protocol during its first commitment period (2008-2012): carbon dioxide (CO2), methane (CH4), nitrous oxide (N2O), hydrofluorocarbons (HFCs), perfluorocarbons (PFCs) and sulphur hexafluoride (SF6).

While the Effort Sharing targets cover most sectors that fall outside the scope of the EU ETS, emissions from land use, land use change and forestry (LULUCF) and international shipping are not included. 

Documentation

Key documents

Studies

2012

2010

Faq

Questions and Answers on the Effort Sharing Decision (October 2013)

How is the European Union's greenhouse gas emission reduction target for 2020 shared out between sectors and Member States?

The 2009 climate and energy package implements the goal of reducing EU greenhouse gas emissions to 20% below 1990 levels by 2020. The reduction effort is shared out as follows:

  • a 21% reduction in emissions from sectors covered by the EU emissions trading system (EU ETS) compared to 2005 levels;
  • an around 10% reduction from most other sectors compared to 2005. These sectors are covered by the Effort Sharing Decision (ESD).

Taken together, these two instruments will deliver an overall reduction of 14% compared with 2005, which is equivalent to a reduction of 20% compared with 1990. A larger reduction is required of the EU ETS sectors because it is cheaper to reduce emissions in the electricity sector than in most other sectors.

Since a single, EU-wide cap on EU ETS emissions will be introduced from 2013, the effort-sharing arrangement between Member States under the ESD has been determined solely for the reduction in emissions from sectors not covered by the EU ETS. These sectors include transport (road and rail, but not aviation or international maritime shipping), buildings (in particular heating), services, small industrial installations, agriculture and waste. Though many of the emitters are small, collectively these sectors represent some 60% of the EU's total greenhouse gas emissions. Emissions from land use, land use change and forestry (LULUCF) are not included in the ESD.

As a rule, it is up to Member States to define and implement their own policies and measures to reduce emissions from the ESD sectors. However, a number of EU-level measures taken in areas such as energy efficiency standards, limits on CO2 emissions from cars and vans, and waste management will also contribute to emission reductions in these sectors.

Schema of the efforts targets

How is the 10% reduction target for sectors covered by the Effort Sharing Decision shared out between Member states?

All Member States have taken on national emission targets for 2020 which are expressed as a percentage change from 2005 levels. Collectively, these national targets give an overall reduction of 10%.

GDP per capita has been used as the main criterion when setting the national targets. This approach has two advantages. It ensures that the actual efforts and the associated costs are distributed in a fair and equitable manner. It also allows for further, accelerated growth in less wealthy countries where economic development still needs to catch up with other Member States.

Under the ESD countries with a low GDP per capita will be allowed to emit more than they did in 2005 because their relatively higher economic growth will probably be accompanied by increased emissions in sectors such as transport. The emissions reduction required in Member States where GDP per capita is below the EU average is therefore correspondingly lower (i.e. less than 10% below 2005 levels). Less wealthy Member States will be allowed to increase their emissions in the ESD sectors by up to 20% above 2005 levels. These targets do, however, represent a cap on their emissions and will still require a reduction effort.

Effort Sharing targets for 2020

By contrast, in the wealthier Member States, where GDP per capita exceeds the EU average, emission reductions above the EU average are required. These go up to a maximum target of 20% below 2005 in the Member States with the highest GDP per capita.

The 20% limit on national emission reductions or increases compared with 2005 ensures that the targets for each country remain technically and economically feasible and that there is no unreasonable increase in overall costs.

What can a Member State do to meet its national target in sectors covered by the Effort Sharing Decision?

In sectors such as buildings and road transport, many of the important decisions will be made at Member State level. Policies and measures to lower emissions potentially include traffic management, shifts away from carbon-based transport, taxation regimes, the promotion of public transport, biofuels, urban and transport planning, improved energy performance standards for buildings more efficient heating systems, and renewable energy for heating. Measures to reduce and recycle waste streams, and to reduce landfilling can also have a significant impact on greenhouse gas emissions.

Guidelines for State aid in the area of environment increase the ability of Member States to implement such measures while avoiding distortions of competition in the internal market.

A number of important EU-wide measures will also help Member States to reduce emissions and thus meet their national targets. New efficiency standards for boilers and water heaters, for example, together with adequate labelling systems to inform consumers, could help deliver major emissions reductions in buildings. The full implementation of the directive on the landfilling of waste (in 2016) will deliver a major reduction in emissions of methane, a powerful greenhouse gas.

In addition, Member States can also use a range of flexibilities, including credits from Clean Development Mechanism (CDM) projects (see point 5).

Why are all objectives based on the year 2005, not 1990 like the Kyoto Protocol?

2005 represented the current situation when work began on the economic analysis which underpins the climate and energy package. Calculating emission reductions and renewable energy shares for 2020 against 2005 levels therefore gives a transparent and easily understandable picture of the changes needed.

Can a Member State set a more ambitious national target for its greenhouse gas emissions than its obligations under EU legislation?

Yes, there is nothing to prevent Member States from adopting their own targets for emissions from sectors under the Effort Sharing Decision and giving visibility to their own efforts to fight climate change, tracking progress and engaging the public. Indeed, a number of Member States, including Denmark, Germany, Sweden and the United Kingdom, have adopted such national targets that go beyond their commitments under EU legislation.

However, national targets cannot be set for total greenhouse gas emissions in 2013-2020 because it cannot be known by how much emissions from sectors covered by the EU ETS will be reduced in each Member State. This is because from 2013 there is a single, EU-wide cap on EU ETS emissions in place of the national caps which existed previously.

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