Annex 1: Procedural Information

1.Lead DG, Decide Planning/CWP references

Lead DG: European Commission Directorate-General for Competition (DG COMP)

Decide Planning Reference: PLAN/2018/4137

2.Organisation and timing

The Inter-Service Steering Group (ISSG) was set up in November 2018 and gathered representatives from the Commission's Secretariat General, Legal Service, Joint Research Centre (JRC), and the following Directorates-General: CLIMA, ENER, ENV, ECFIN, EMPL, GROW, JUST, MOVE, REGIO, RTD, TAXUD and TRADE. The ISSG was consulted on the Inception Impact Assessment, the Consultation Strategy, the intervention logic and main policy options, the questionnaire for the public consultation, the summary report of the open public consultation, the interim and final study.

DG COMP organized eight ISSG meetings on 5 December 2018, 29 April 2019, 11 July 2019, 13 September 2019, 21 October 2019, 7 and 20 May 2020, and 23 July 2020. On a number of deliverables, the group was consulted in writing. The members of the group were invited to all events organised in the context of the consultation process described in Annex 2.

The Inception Impact Assessment was published in December 2018. It set out the context, purpose and scope of the evaluation exercise as well as objectives of the intervention and policy options. It also contained information on the planned open public consultation, the data collection and methodology.

The back-to-back Evaluation and Impact Assessment were also supported by an external study. The purpose of the study was to provide information enabling the Commission to update section 3.5 "Support for indirect CO2 costs" of the existing evaluation conducted by the Commission in the context of the adoption of the ETS Directive, and to provide an update of available literature on carbon leakage risk. In addition, the study focused on assessing how the different policy options as regards sectoral eligibility and as regards proportionality will impact a range of economic sectors. Also, the evaluation activity was supported by a study prepared by the JRC.

Table 1: Overview of the timing

Date Description of the activities 5 December 2018 Announcement of the launch of the back-to-back Evaluation and Impact Assessment 5 December 2018 1st ISSG meeting: -general overview of the initiative, presentation of key features of the existing 2012 ETS Guidelines -explanation of the back-to-back procedure -presentation of the intervention logic and the main policy options -discussion on Inception Impact Assessment, Consultation Strategy, the draft questionnaire for the public consultation, and Technical Specifications for the external study 20 December 2018 - 17 January 2019 Publication of the Inception Impact Assessment 29 April 2019 2nd ISSG meeting: -debrief about the feedback to the consultation on the Inception impact assessment and the targeted consultation to sectors -discussion on the Inception Report of the external consultant 21 February 2019 - 16 May 2019 Open public consultation 13 February 2019 – 09 April 2019 Targeted consultation of interested sectors ( https://ec.europa.eu/competition/consultations/2019_ets_guidelines/index_en.html ) 27 February 2019 – 16 May 2019 Targeted consultation of Member States 4 April 2019 Upstream meeting with the Regulator Scrutiny Board (RSB) 11 July 2019 3rd ISSG meeting: -debrief about the results of the targeted consultation of Member States and of the public consultation -discussion on the Intermediate Report of the consultant, to inform the ISSG about the ongoing work of the consultant, the methodology applied as well as preliminary results of the qualitative assessment of sectors -memo prepared by the consultant on indirect cost compensation schemes among Member States and a literature review on theory and evidence of carbon leakage. 13 September 2019 4th ISSG meeting: -discussion on the Draft Final Report submitted by the consultant, the draft Evaluation and chapters 1-4 of the draft Impact Assessment Report 21 October 2019 5th ISSG meeting: -discussion on the remaining chapters of the draft Impact Assessment Report 14 January 2020 – 10 March 2020 Targeted consultation on the draft Guidelines of Member States and interested stakeholders ( https://ec.europa.eu/competition/consultations/2020_ets_stateaid_guidelines/index_en.html ) 11 February 2020 Multilateral meeting with the Member States 7 May 2020 6th ISSG meeting: -debrief about the results of the targeted consultation on the draft Guidelines -presentation of the draft final version of the evaluation, including the draft final JRC report -discussion on the draft final version of the Impact Assessment Report 20 May 2020 7th ISSG meeting: -discussion on the draft final version of the Impact Assessment Report incorporating comments of the services 24 June 2020 Meeting with the RSB 23 July 2020 8th ISSG meeting: -debrief about the meeting with the RSB and presentation on how the Impact Assessment Report will incorporate the RSB recommendations.

No exceptions were made to the Better Regulation Guidelines during this back-to-back evaluation and impact assessment.

3.Consultation of the Regulatory Scrutiny Board

An upstream meeting with the Regulatory Scrutiny Board (RSB) took place on 4 April 2019 to discuss the DG's evaluation/impact assessment of the EU Emission Trading System (ETS) State aid guidelines. The RSB members and DG-COMP discussed difficulties of obtaining reliable empirical evidence about the impact of the guidelines on carbon leakage. RSB members stressed that the evaluation and the impact assessment should be transparent about the degree of uncertainty of the analysis. With regard to methodology, RSB members recommended that the intervention logic more clearly reflect the trade-offs between the various objectives. RSB members also stressed that the various sources of evidence should be checked against each other (triangulated) to test their reliability and gain additional insights. The report should not report stakeholder feedback uncritically. RSB members suggested that the impact assessment pay attention to issues of future-proofing. Policy options should consider the need for the new guidelines to build in flexibility to adapt to future changes, such as new technologies or carbon price evolutions.

The RSB meeting took place on 24 June 2020. The opinion of the Board was positive with reservations. The Board expects the report to be rectified with respect to the following aspects:

1.The report is not sufficiently explicit about relevant on-going policy developments in the context of the European Green Deal. It is not clear about the possible temporary nature of the proposal, as a stopgap to bridge the period between January 2021 and new proposals.