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Moving Towards Phase III—Key Elements of the Review of the EU Emissions Trading Scheme

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With the Climate and Energy Package the European Commission has also published its draft for a revised EU Emissions Trading Scheme from 2013 onwards. The draft revision of the EU ETS serves as the EU's main pillar to fight climate change in that it requires a reduction of mainly CO2 of 21% below 2005 figures for the EU's major emissions sources in the energy and industry sectors. In addition, most notably the EU is proposing an EU wide cap and harmonised allocation rules, in order to exploit the full potential of emissions trading making national allocation plans ghosts of the past. The revised EU ETS gives investors into CDM projects the necessary long time planning security for investments into projects. At the same time it sends out a strong signal to the international negotiations for a post-2012 climate agreement in that it allows the use of more project based generated credits within the EU ETS once an ambitious post 2012 agreement is concluded.


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