1. Climate Action Policy Developments
Velina Pendolovska
DG Climate Action
ESTAT Working Group on Environmental Accounts/Expenditure Statistics
20 March 2013
Luxembourg

2. International climate developments
2011 climate negotiations: Durban Platform for Enhanced Action (ADP) – towards a binding global agreement for emission reductions post-2020, to be agreed by 2015
2012 climate negotiations: Kyoto Protocol 2nd Commitment Period (2CP), raising ambition before 2020
The 2015 Agreement will need to:
address the challenge of attracting all major economies, including the US, China, India and Brazil
reduce global emissions to below 1990 levels by 2030, equivalent to a global reduction of ~25 % compared to actual 2010 emissions
be legally binding and provide for robust compliance rules based on a strong improved emissions accounting system (MRV regime)
Kyoto Protocol 2CP: EU27, HR, NO, CH, IS, LI, MC, AU; EU27+IS+HR target – 20% reduction by 2020 compared with 1990 levels – consistent with the climate and energy package
Next COP.19 in Warsaw, Poland in November 2013
Current discussions are on-going on the internal distribution of the 20% target across all MS+HR+IS.

3. Domestic policy developments
Current emissions – where do we stand?
Green paper on 2030 policy framework
Adoption of the Monitoring Mechanism Regulation
The European Semester and the Annual Growth Survey
Adaptation policy
EU ETS
Climate campaign "A World You Like with a Climate You Like"

4. Current emissions – where do we stand?
Levels:
EU-27 emissions down to 18.5% below 1990 levels
EU-15 emissions down to 14.8% below Kyoto baseline year levels
Targets:
EU-27 Europe 2020 target is -20% below 1990 levels
EU-15 Kyoto Protocol 1CP target is -8% below Kyoto baseline levels for the period
* Source: 15 January MS submissions under the Monitoring Mechanism Decision

5. Post 2020 – looking ahead to 2030
Climate and energy package up to 2020; need to start preparing for 2030
Green Paper on "A 2030 framework for climate and energy policies" to be published soon (indicative date: end of March)
GP to pave the way for a 2030 policy framework and provide long- term vision for investment
Key issues:
Targets - Types, nature and levels?
towards an 80-95% GHG emissions reduction by 2050 in line with a 2° global temperature rise = 40% reduction by 2030
Competitiveness of the EU industry
Taking into account the differing capacities of Member States
Choice and interaction between policy instruments
Target types: national or EU? Sectoral or total? Intensity-type targets or in absolute terms?
Factors to be taken into account: rising energy prices, the need to invest in new energy infrastructure and to avoid "lock-in" scenarios, the need to continue with the reduction of emissions: 2050 Roadmap – 80-95% GHG emissions reduction by 2050, will require 40% emissions reduction by 2030.
Competitiveness must remain intact, renewable sources of energy would be competitive on a par with other more conventional sources by 2020.
Distributional aspects and different starting points must be taken into account

6. Monitoring Mechanism Regulation (MMR) Adoption
Basis for monitoring of GHG emissions in the EU and implementing the Kyoto Protocol: the Monitoring Mechanism Decision (MMD) 280/2004/EC.
The Monitoring Mechanism Regulation (MMR) – revision of MMD, key objective: Ensure timely, transparent, accurate, consistent, complete reporting at Union and MS level in line with new requirements under the Climate and energy package
New elements:
Low-carbon strategies, approximated greenhouse gas inventories (x-1), emission estimates, adaptation, expert inventory review (ESD), financial and technology support, auctioning revenues, recalculations, evaluation of progress, new gas (HF3)
MMR in final stages of adoption – EP vote on 12 March: 634/42/5
Provisional agreement between co-legislators reached on 21 December 2012.
The aim of the new regulation is to enhance the monitoring and reporting framework within the EU, in the light of lessons learned from implementation of the current decision, to take account of developments at both Union and international level. In particular, the proposal incorporates new reporting and monitoring requirements arising from the 2009 Climate and Energy Package and from recent decisions adopted under the United Nations Framework Convention on Climate Change (UNFCCC).

7. The European Semester and Annual Growth Survey cycle
Coordinates the MS' macro-economic policies and progress toward the Europe 2020 targets
High political attention
The main steps of the cycle are:
Annual Growth Survey (November);
European Council (end of March);
National Reform Programs (April) and
Country Specific Recommendations (Commission proposal in May and Council adoption in June).
The European Semester requires integrated climate-economic analysis of climate policies and measures – relying on a lot of data besides emissions!
AGS 2013 focussed on:
Fiscal consolidation;
Normal lending to the economy;
Growth and Competitiveness;
Employment;
Public administration.

8. Adaptation Policy Effects of climate change are inevitable:
Temperature of the European land area over the last decade ( ) has risen by 1.3°C above preindustrial level
Minimum cost of not adapting estimated to range from € 100 billion a year in 2020 to € 250 billion in 2050 for the EU as a whole
Floods resulted in more than 2500 fatalities and affected more than 5.5 million people over the period
The response: An Adaptation Strategy for the EU (to be published in April)
promoting action by MS to adopt national adaptation strategies
bridging the knowledge gap and further develop Climate-ADAPT
mainstreaming adaptation in key vulnerable sectors, such as infrastructure, agriculture, energy, transport, health, coastal and marine issues, etc.

9. EU ETS
EU ETS – "cap-and-trade" system for trading GHG emissions allowances: covers more than 11,000 power stations and industrial plants in 31 countries (EU27+IS+LI+NO+HR) and airlines = 45% of EU total emissions
Third phase – significant changes:
ETS target – EU-wide cap of 21% reduction by 2020 compared with 2005 levels
Auctioning, not free allocation, is now the default method for allocating allowances
Single EU Registry for emissions trading
More sectors and gases included (N2O, PFCs)
Debate on structural reform – surplus of allowances due to effects of economic crisis:
proposal to postpone (or 'back-load') the auctioning of 900 million allowances from the years until as an immediate measure
On-going consultation on possible structural measures
Linking the EU ETS with Australia
The surplus now amounts to more than two billion emission allowances, which approximately corresponds to the annual emissions of all installations covered by the EU ETS. This lack of scarcity will continue for at least the next ten years.
Adaptation measures (proposal on back-loading) were rejected by the Committee on Industry, Research and Energy of the European Parliament at the end of January 2013.
A sustainable solution to the growing imbalance between supply and demand requires structural changes to the EU ETS. The six options are:
Increasing the EU’s greenhouse gas emissions reduction target for 2020 from 20% to 30% below 1990 levels;
Retiring a certain number of phase three allowances permanently;
Revising the 1.74% annual reduction in the number of allowances to make it steeper;
Bringing more sectors into the EU ETS;
Limiting access to international credits; 
Introducing discretionary price management mechanisms such as a price management reserve.

10. Climate Campaign – "A World You Like with a Climate You Like"
This campaign aims to show solutions and best practices applied by citizens, businesses and authorities across the European Union. It covers five areas: travel and transport; production and innovation; building and living; shopping and eating; and re-use and recycling.
Through this website and the campaign's Facebook page you can discuss Europe's low-carbon future with other Europeans including Connie Hedegaard, European Commissioner for Climate Action.

11. Thank you for your attention
Thank you for your attention ! Velina Pendolovska DG CLIMA - Unit A3