Producers to be compensated for higher electricity costs resulting from emissions cap

The European Commission has adopted a framework for Member states to compensate users for higher electricity costs resulting from the EU Emissions Trading Scheme. Users that are eligible for such compensation are producers of aluminium, copper, fertilizers, steel, paper, cotton, chemicals and some plastics. Joaquín Almunia explained the justification for the scheme, saying that such compensation ensures that producers do not shift their activities to countries that have less environmental regulation. The producers assisted by the framework are of sectors identified as those placed at significant risk of carbon leakage (where greenhouse gas emissions increase when production moves outside the EU).

The change to the EU Emissions Trading Scheme will be effective in 2013. It imposes a stricter cap on carbon dioxide emissions.

Full content: EC Press Release

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