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Emissions Trading

Volume 454: debated on Monday 4 December 2006

To ask the Secretary of State for Environment, Food and Rural Affairs what his policy is on allocating allowances in phase two of the European Union Emissions Trading Scheme. (103753)

The UK’s National Allocation Plan for phase II of the EU Emissions Trading Scheme (EU ETS), submitted on 21 August, sets out our methodology for allocating allowances. Phase II of the EU ETS allows for a maximum level of auctioning of allowances of 10 per cent., and we propose to set the level of auctioning in the UK at 7 per cent. The remainder of the allowances will be allocated in a two stage process that allocates allowances at sector level in the first instance and subsequently allocates to installations within each sector. Allocations at sector level, other than to the Large Electricity Producers (LEP), will be made on the basis of the sector’s projected need between 2008 and 2012. Allocations at installation level will be based on historic emissions, with the exception of the LEP sector, whose allocations will be benchmarked.

To ask the Secretary of State for Environment, Food and Rural Affairs if he will assess the impact of the European Union Emissions Trading Scheme. (103754)

The approved UK National Allocation Plan for Phase I (2005-2007) of the EU Emissions Trading Scheme is set to deliver savings in carbon dioxide emissions of around 65 million tonnes (roughly 8 per cent.) below the projected emissions of the traded sector.

The UK's proposal for Phase II of the scheme provides business with additional certainty on the contribution it needs to make to help tackle climate change and is expected to deliver additional savings of 29.3 million tonnes of carbon dioxide each year.

Over 1,000 UK installations are covered by the scheme in the first phase, covering around 45 per cent. of the UK's CO2 emissions in 2002. Almost 12,000 installations are involved across the 25 member states of the EU, accounting for approximately 50 per cent. of EU CO2 emissions.

The results of the first year of the scheme were published in May 2006. These showed that the infrastructure is working as expected, and that it provides a sound base to build on for the future. It is too early to determine the overall impact of the EU Emissions Trading Scheme with just one year's data. However DEFRA carried out an analysis of these data and will publish its findings shortly.

To ask the Secretary of State for Environment, Food and Rural Affairs what proportion of (a) carbon dioxide emission and (b) Kyoto basket emissions are estimated to have come from air transport flights taking off and landing in UK airports in 2005. (103759)

In 2004, the latest year for which figures are available, domestic aviation accounted for an estimated 0.42 per cent. of UK carbon dioxide (CO2) emissions, and an estimated 0.36 per cent. of UK greenhouse gas emissions in the Kyoto basket. These figures do not include international aviation which is reported as an information item in the UK greenhouse gas inventory but does not, by international agreement, count towards national totals.