December 7, 2018 CO2: We Must Pay Our Debts
The EU Emissions Trading Scheme has been widely criticized. But after its revamp last year, emitting greenhouse gases will begin to cost more – and outdoor companies can participate voluntarily.
Most people would agree that the basic idea is a good one: In 2005, a cap was set for greenhouse gases across the entire EU, including Norway, Iceland and Liechtenstein. Each country received an annual quota, which was then distributed to their respective energy-intensive industries and operations. If a company emitted more than their quota, they were required to purchase new emissions allowances from a common market. In turn, the price per ton greenhouse gas (in CO2 equivalents, or CO2e) would increase incrementally. This would eventually make it more profitable to reduce emissions than to purchase new emissions allowances. The system was named the EU Emissions Trading Scheme (EU ETS). Problems began to appear during the first phase, whereby too many quotas were distributed and unused allowances could be saved by companies for the following year. In practice it cost almost nothing to continue as normal. In order for the EU to have a reasonable chance of living up to its climate goals, the system had to be renovated. In 2017, a new system was legislated that enters into force in 2021. From this point on, the total number of allowances will decrease by 2.2% each year, and from 2023, it will no longer be possible to build up large reserves.
Most actors within the outdoor industry currently do not fall under mandatory participation in this scheme, either because their emissions are below the minimum threshold or their manufacturing is based outside the EU. This might soon change, however, as the EU ETS’ coverage continues to expand and as countries like China and India have emissions trading schemes of their own that are now coming into effect. In the meantime, companies and even individuals can voluntarily make use of the EU ETS, as a means of offsetting their carbon emissions. This is done quite simply by purchasing emissions allowances, then “deleting” them so that other polluters cannot use them. Several third-party providers offer this service (eg. chooose.today) enabling a company to take responsibility effectively, even if it is not forced to do so.