The second sentence of Article 49(1) of Commission Regulation (EU) No 601/2012 of 21 June 2012 on the monitoring and reporting of greenhouse gas emissions pursuant to Directive 2003/87/EC of the European Parliament and of the Council and point 10(B) of Annex IV to that regulation are invalid in so far as they systematically include the carbon dioxide (CO2) transferred to another installation for the production of precipitated calcium carbonate in the emissions of the lime combustion installation, regardless of whether or not that CO2 is released into the atmosphere.

The economic logic underlying the greenhouse gas emission allowance, in accordance with Article 1 of Directive 2003/87, consists in ensuring that the reductions of greenhouse gas emissions required to achieve a predetermined environmental outcome take place at the lowest cost. By allowing, in particular, the allowances allocated to be sold, the scheme is intended to encourage a participant in the scheme to emit quantities of greenhouse gases less than the allowances originally allocated him, in order to sell the surplus to another participant who has emitted more than his allowance (see, inter alia, judgments of 16 December 2008, Arcelor Atlantique et Lorraine and Others, C‑127/07, EU:C:2008:728, paragraph 32, and of 7 April 2016, Holcim (Romania) v Commission, C‑556/14 P, not published, EU:C:2016:207, paragraphs 64 and 65).

Thus, one of the pillars on which the scheme established by Directive 2003/87 is built is the obligation for operators to surrender by 30 April of the current year, in order to have them cancelled, a number of greenhouse gas emission allowances equal to their emissions during the preceding calendar year (judgment of 29 April 2015, Nordzucker, C‑148/14, EU:C:2015:287, paragraph 29). It is therefore crucial, for the correct operation of the scheme established by Directive 2003/87, to identify the emissions which must be taken into account by operators in that regard.

According to Article 3(b) of Directive 2003/87, ‘emissions’ are, for the purposes of that directive, defined as the release of greenhouse gases into the atmosphere from sources in an installation. It follows from the very wording of that provision that, for there to be an emission within the meaning of that provision, a greenhouse gas must be released into the atmosphere.

Indeed, it should be noted in that regard that Article 12(3a) of Directive 2003/87 provides that, subject to certain conditions, emissions which have been captured and transported for their permanent geological storage to a facility for which a permit is in force in accordance with Directive 2009/31 are not subject to the allowance surrender obligations. Nevertheless, and contrary to the submissions of the Commission, that does not mean that the EU legislature considered that operators are exempt from the obligation to surrender only in the sole instance of permanent geological storage.

By contrast to the last paragraph of Article 49(1) of Regulation No 601/2012, which provides that for any other transfer of CO2 no subtraction of CO2 from the installation’s emissions is to be allowed, Article 12(3a) of Directive 2003/87 contains no similar rule.

The latter provision, which refers only to a particular situation and is intended to encourage the storage of greenhouse gases, was not intended to, and did not, amend the definition of ‘emissions’ within the meaning of Article 3 of Directive 2003/87, or even, by implication, the scope of that directive as established in Article 2(1) thereof.

However, in a situation such as that at issue in the main proceedings, where the CO2 produced by an installation for the production of lime is transferred to an installation for the production of PCC, it appears, under the second sentence of Article 49(1) of Regulation No 601/2012 and point 10(B) of Annex IV to that regulation, that all of the CO2 transferred, whether or not part of that CO2 is released into the atmosphere during its transportation, due to leakages, or even the production process itself, is regarded as having been emitted by the installation for the production of lime in which that CO2 was produced, although the transfer might not result in any release of CO2 into the atmosphere. As the Advocate General noted in point 41 of her Opinion, those provisions create an irrebuttable presumption that all the CO2 transferred has been released into the atmosphere.

Those provisions thus lead to the CO2 transferred in such circumstances being regarded as falling under the definition of ‘emissions’ within the meaning of Article 3(b) of Directive 2003/87, despite not always being released into the atmosphere. By the second sentence of Article 49(1) of Regulation No 601/2012 and point 10(B) of Annex IV to that regulation, the Commission therefore broadened the scope of that definition.

Furthermore, it follows from that presumption that the operators concerned may not, in any circumstances, subtract the amount of CO2 transferred for the production of PCC from the aggregate emissions of their installations for the production of lime, despite the fact that that CO2 may not always be released into the atmosphere. Such an impossibility means that the allowances must be surrendered for all of the CO2 transferred for the production of PCC and may no longer be sold as excess, thus calling into question the allowance trading scheme in circumstances nevertheless consonant with the ultimate objective of Directive 2003/87, which seeks to protect the environment by means of a reduction of greenhouse gas emissions (as regards the aims of Directive 2003/87, see judgment of 16 December 2008, Arcelor Atlantique et Lorraine and Others, C‑127/07, EU:C:2008:728, paragraph 31).

It follows from all the foregoing considerations that the Commission, having altered an essential element of Directive 2003/87 when it adopted the second sentence of Article 49(1) of Regulation No 601/2012 and point 10(B) of Annex IV to that regulation, overstepped the limits laid down in Article 14(1) of that directive.

(see paras 31-38, 41-43, 50, 51, operative part)