Brussels, 29/03/2000 (Agence Europe) - The European Commission approved the Danish system for tradable CO2 emission permits for the electricity sector. This is the first of its kind in a European Union Member State within the framework of the EU commitments taken during the international conference in Kyoto on the reduction of polluting emissions. The EU undertook to reduce its emissions by 8% during the period 2008-2012 compared to the 1990 level, and Denmark must reduce its emissions by 21% during the same period, under the agreement concluded within the EU.
The Danish system is founded on a national annual emission ceiling authorised for the production of electricity, a sector responsible for 40% of all CO2 emissions in Denmark. The ceiling is set at 22 million tonnes in 2001, 21 million in 2002 and 20 million in 2003. The national quota is allocated free of charge to existing electricity producers, at a level representing 70% of their emissions between 1994 and 1998. The producers who remain below their quota may trade their surplus to other producers or keep it for the following year. Exceeding quotas entails fines of around EUR 5.4 per tonne. The Commission considered that this system represents State aid but that it may be authorised as long as it does not prevent new actors from entering the Danish electricity market. New entrants should therefore receive emission quotas based on non-discriminatory criteria to be approved by the Commission.