EU Factories Double Use of UN Carbon Credits Last Year in SurveyAlessandro Vitelli
Power stations and factories in the European Union’s emissions market probably doubled their use of United Nations carbon offsets to meet their pollution limits last year, according to a survey of analysts.
Companies have surrendered about 600 million Certified Emission Reductions and Emission Reduction Units for 2012, compared with 254.6 million offsets in the previous year, according to the median estimate of five analysts surveyed by Bloomberg News in the past two days. The European Commission will today publish data on how many offsets were used to match emissions at more than 12,000 installations.
Offset use has surged as credits for emissions of hydrofluorocarbon-23 and nitrous oxide, used in the production of refrigerators and nylon, lose their eligibility in the EU market at the end of the second phase of the market, which ran from 2008 through 2012. As many as 240 million certificates were available to buyers as of April 30, the deadline for compliance, UN data compiled by Bloomberg show.
Under EU rules, companies can use a maximum of 1.4 billion tons of UN offsets for compliance in the second phase of the market, which is equivalent to 68 percent of last year’s emissions cap set by the EU. Any unused quota of eligible credits may be used in the third phase that runs through 2020.
The estimate of offsets used in 2012 by European emitters means that installations in the world’s largest carbon market may transfer as many as 1.9 billion unused EU permits into the third phase, which started in January, according to data compiled by Bloomberg New Energy Finance.
UN Certified Emission Reductions and Emission Reduction Units represent the cutting of one ton of carbon dioxide equivalent.