EU emissions continued to decline during the pandemic
This is what the latest annual report of the European Environment Agency (AEMA, European Environment Agency, EEA) “Trends and projections in the EU ETS / Trends and projections in the EU ETS”. Based on recent trends, greenhouse gas emissions from stationary installations reported in the Emission rights trading system (Emissions Trading System, ETS) in the EU fell by just over 11% between 2019 and 2020.
According to Member States’ projections sent to the EEA, it is expected that ETS emissions decrease by 41% to 48% by 2030, and by 55% to 62% by 2040, relative to 2005. Most of this decline is expected to occur in the energy sector and represents a slowdown from historical declines, according to the report ‘Trends and projections in the EU ETS/’Trends and projections in the EU ETS‘. The projected reductions could become more pronounced as the package is implemented.’F it for 55‘ and Member States include more ambitious measures in their projections.
As for the latest trends, 2020 saw the largest annual drop in emissions since the ETS began in 2005. Although it has been observed a downward trend in ETS emissions in recent years, including a momentous 9% drop between 2018 and 2019, declines in energy demand and industrial activity during the first year of the Covid-19 pandemic caused further substantial reductions. The summary is based on a detailed analysis of the report Trends and projections in STDs in the EU in 2021 / Trends and projections in the EU ETS in 2021 , prepared for the EEA by the European Topic Center on Climate Change Mitigation and Energy.
Other key findings
- Greenhouse gas emissions from stationary facilities at the ETS decreased from 1,530 million tonnes of carbon dioxide equivalent (MtCO2e) in 2019 to 1,355 MtCO2e in 2020, a reduction of 11.4%. This represents the largest drop in emissions since the ETS began operating in 2005. It is only comparable to the decline seen in 2009 at the height of the financial crisis.
- This decrease in emissions is added to the notable reduction of 9% that occurred between 2018 and 2019.
- STD emissions from aircraft operators plummeted by 63% as air travel all but stopped during the pandemic.
- The number of available rights exceeded annual emissions for the first time since 2013, mainly due to low demand. Carbon prices fell sharply in March 2020 but recovered by the end of the year.
- According to Member States’ projections, ETS emissions are expected to decrease by between 41% and 48% by 2030, and between 55% and 62% by 2040, relative to 2005.
The EU ETS is a cap-and-trade system, covering around 36% of the EU’s total greenhouse gas emissions. It sets a limit on emissions from emission-intensive activities such as electricity and heat production, cement manufacturing, iron and steel production, oil refining and other industrial activities, and aviation within the European Economic Area. Within this emissions budget, companies can reduce their emissions and trade allowances to achieve reductions in greenhouse gas emissions at the lowest cost.
More details, here.
12 January 2022