REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL PROGRESS TOWARDS ACHIEVING THE KYOTO OBJECTIVES 
Date: 2010-10-12
Institutions: European Commission
Subjects: EU environmental policy, greenhouse gas, international convention, pollution control measures, reduction of gas emissions, report, tradeable emission permit

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EUROPEAN COMMISSION 

Brussels, 12.10.2010 
COM(2010) 569 final 

REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND 
THE COUNCIL 

PROGRESS TOWARDS ACHIEVING THE KYOTO OBJECTIVES 

(required under Article 5 of Decision 280/2004/EC of the European Parliament and of the 
Council concerning a mechanism for monitoring Community greenhouse gas emissions and 
for implementing the Kyoto Protocol) 

SEC(2010) 1204 

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TABLE OF CONTENTS 

1. 

2. 

2.1. 

2.2. 

2.3. 

2.4. 

3. 

SUMMARY ................................................................................................................. 3 

ACTUAL PROGRESS 1990-2008 .............................................................................. 5 

GHG emission trends ................................................................................................... 5 

GHG intensities and emissions per capita in 2008....................................................... 6 

GHG emissions in 2008 compared to 2007 ................................................................. 7 

Emission trends in the main sectors ............................................................................. 8 

PROJECTED PROGRESS TOWARDS MEETING THE KYOTO TARGET ........ 10 

3.1. 

Projections of GHG emissions ................................................................................... 10 

3.1.1.  EU-15 ......................................................................................................................... 10 

3.1.2.  EU-12 ......................................................................................................................... 10 

3.1.3.  EU-27 ......................................................................................................................... 10 

3.2. 

3.3. 

Implementation of the EU climate change policy...................................................... 12 

Implementation of the EU Emissions Trading System (EU ETS)............................. 13 

3.3.1.  Second trading period (2008-2012) ........................................................................... 13 

3.3.2.  Use of JI and CDM by operators................................................................................ 14 

3.4. 

3.5. 

4. 

4.1. 

4.2. 

4.3. 

5. 

Projected use of Kyoto mechanisms by government ................................................. 14 

Projected use of carbon sinks..................................................................................... 14 

MEETING THE 2020 TARGET ............................................................................... 15 

EU GHG emission reduction target by 2020 ............................................................. 15 

Policies contributing to the fulfilment of targets........................................................ 15 

Projected distance to targets....................................................................................... 15 

SITUATION IN THE EU CANDIDATE COUNTRIES .......................................... 16 

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1. 

SUMMARY 

On track to reach the Kyoto target, 2008-2012 

Under  the  Kyoto  Protocol,  the  EU-15  has  agreed  to  reduce  its  greenhouse  gas  (GHG) 
emissions  by  8%  by  2008–12  compared  to  base  year  levels1.  Based  on  the  latest  available 
inventory  data  of  20082,  total  GHG  emissions  in  the  EU-15  have  fallen  for  the  fifth 
consecutive  year  and  were  6.9%  below  base  year  emissions  without  Land  Use,  Land  Use 
Change  and  Forestry  (LULUCF).  While  since  1990,  the  economy  has  grown  significantly 
with an increased of EU-15 GDP by almost 45%, GHG emissions in EU-15 have nevertheless 
been decreasing. 

In 2008, EU-15 GHG emissions decreased by 1.9% compared to 2007 while the EU-15 GDP 
grew  by  0.6%.  Projections3  as  shown  in  Figure  1  indicate  that  the  EU-15  will  reach  its 
Kyoto target. Current projections, reflecting the economic recession, indicate that the target 
is very likely to be overachieved. 

Figure 1: Actual and projected emissions for EU-15 

Note: The arrows are based on 2008-2012 average and therefore do not correspond exactly to 2010 values of 
projected emissions. 2009 emissions are preliminary estimates from the European Environment Agency. 
Source: European Commission 

According  to  the  recent  GHG  projections  six  Member  States  (Finland,  France,  Germany, 
Greece,  Sweden,  the  United  Kingdom)  are  on  track  to  achieve  their  GHG  reduction  targets 
domestically. Taking into account the planned use of the Kyoto flexible mechanisms, use of 
unused allowances from the EU ETS new entrant reserve and carbon sinks, only two Member 
States  (Austria  and  Italy)  might  face  difficulties  with  achieving  their  targets,  though  not 
undermining  the  overall  EU-15  capacity  to  meet  its  Kyoto  target.  In  most  of  the  twelve 
Member  States  which  entered  the  EU  as  from  2004  emissions  are  projected  to  slightly 

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decrease between 2008 and 2012, nine of them that have a Kyoto target4 are projected to meet 
or  over-achieve  their  Kyoto  targets  using  only  existing  policies  and  measures.  Slovenia 
projects that it will meet its target when all the existing and planned measures, including the 
purchase of Kyoto credits will deliver as expected.  

Total EU-27 GHG emissions were, in 2008, 14.3% below base year levels without emissions 
and  removals  by  LULUCF.  Emissions  were  2%  lower  compared  to  2007  while  during  the 
same period the EU-27 economy grew by 0.7%. 
Additionally,  according  to  the  provisional  2009  data5,  EU-15  and  EU-27  greenhouse  gas 
emissions  decreased  by  6.9 %  in  2009  compared  to  2008.  Based  on  these  estimates,  EU-15 
stands 12.9 % below the base-year level, beyond its Kyoto commitment of 8% reduction for 
the first time. EU-27’s 2009 emissions stand approximately 17.3 % below the 1990 level. The 
change of DGP in 1990-2009 was 38% for EU-15 and 40% for EU-27. 

New measures to reach the EU’s ambitious 2020 target 

The  climate  and  energy  package6  adopted  in  2009  provides  an  integrated  and  ambitious 
package of policies and measures to tackle climate change until 2020 and beyond.  

From 2013 onwards the total EU effort to reduce greenhouse gas emissions by 20% by 2020 
compared to 1990 will be divided between the EU ETS and non-ETS sectors as follows:  

(a) 

(b) 

21% reduction in EU ETS sector emissions compared to 2005;  

reduction of around 10% compared to 2005 for the sectors that are not covered 
by the EU ETS.  

The overall reduction of -20% compared to 1990 is equivalent to a -14% reduction compared 
to 2005. A larger reduction is required by the EU ETS sectors because it is more cost effective 
to reduce emissions in the sectors covered by the ETS rather than in the other sectors that are 
not covered by the system.  

Since 2009 further preparation for the implementation of the GHG reduction commitment by 
2020 has taken place. In regard to the implementation of the revised EU ETS Directive this 
covers among others a Commission Decision to determine the sectors and subsectors deemed 
to  be  exposed  to  carbon  leakage  and  a  Commission  Decision  on  the  Community-wide 
quantity  of  allowances  to  be  issued  in  the  third  trading  period.  Furthermore,  rules  for  the 
timing,  administration  and  other  aspects  of  auctioning  of  allowances  and  Community-wide 
harmonised  allocation  rules  for  allocating  allowances  in  the  third  trading  period  are  in 
preparation.  The  Registries  Regulation  is  also  being  revised  in  order  to  address  necessary 
changes. 

The Effort Sharing Decision regulates GHG emissions in all sectors except installations and 
aviation covered by the EU ETS, Land Use, Land Use Change and Forestry (LULUCF), and 
international  maritime  shipping.  It  obliges  Member  States  to  limit  their  GHG  emissions 
between 2013 and 2020 according to a linear trajectory with binding annual targets. This will 
ensure a gradual move towards agreed 2020 targets in the respective sectors. Member States 
will  be  responsible  for  defining  and  implementing  policies  and  measures  to  limit  their 
emissions.  A  robust  monitoring  system  will  be  put  in  place  for  monitoring  Member  States' 
action and help them make any necessary corrective measures if they fail to meet their targets. 
The Commission started work on implementing measures under the Effort Sharing Decision, 
which  include  determining  the absolute  values  for  Member  States  targets  in  2013-2020  and 

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setting  rules  for  transfers  of  annual  emission  allocations  among  Member  States  as  well  as 
ensuring their transparency. 

The 20% GHG reduction objective was also rooted in the Europe 2020 strategy for jobs and 
smart, sustainable and inclusive growth adopted by the European Council in June 2010. The 
emission reduction target is one of the five headline targets. 

Figure 2 illustrates the significant gap between projections for 2020 and the EU's 2020 targets 
(-20% and -30% respectively) requiring the EU to significantly step up its efforts to reduce its 
greenhouse gas emissions. Depending on the actual target, in 2020 emission reductions will 
have  to  amount  to  350  –  800  Mt  CO2  equivalents  compared  to  baseline  scenario.  This 
underlines the need for the EU and its Member States to implement as soon as possible the 
new legislation to ensure that necessary emission reductions will take place. 

Figure 2: Actual and projected emissions for EU-27  

1st commitment 
period

Post-2012

.
q
e

2
O
C

t

M

6.000

5.500

5.000

4.500

4.000

3.500

3.000

1990

1995

2000

2005

2010

2015

2020

EU-27 emissions
PRIMES-GAINS full package projection (-20%)
EU-27 projections Kyoto period

Primes-Gains baseline projection
30% target by 2020

Note: 2009 emissions are preliminary estimates from the European Environment Agency 
Source: European Commission 

2. 

ACTUAL PROGRESS 1990-2008 

2.1. 

GHG emission trends  

The  overall  EU  GHG  emission  trend  is  strongly  influenced  by  the  two  largest  emitters 
Germany  and  the  United  Kingdom,  together  accounting  for  about  one  third  of  total  EU-27 
GHG  emissions.  In  2008,  these  two  Member  States  have  achieved  total  GHG  emission 
reductions of 417 Mt CO2 equivalents compared to 1990.  

The  main  reasons  for  the  favourable  trend  in  Germany  (-22%  in  1990-2008)  are  the 
continuous  efficiency  improvements  in  power  and  heating  plants  as  well  as  in  the  use  of 
combined heat and power, as well as the investments in the economic restructuring of the five 

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new  Länder  after  the  German  reunification.  The  reduction  of  GHG  emissions  in  the  United 
Kingdom (-18.5% in 1990-2008) was primarily the result of liberalising energy markets and 
the  subsequent  fuel  switching  from  oil  and  coal  to  gas  in  electricity  production  and  N2O 
emission reduction measures in adipic acid production.  

Italy  and  France  are  the  third  and  fourth  largest  emitters,  both  with  a  share  of  11%.  Italy’s 
GHG emissions were about 5% above 1990 levels in 2008. The observed increases since 1990 
in Italy's GHG emissions are primarily due to road transport, electricity and heat production 
and  petroleum-refining.  France’s  emissions  were  6%  below  1990  levels  in  2008.  Large 
reductions were achieved in N2O emissions from adipic acid production. But CO2 emissions 
from road transport increased considerably between 1990 and 2008. 

Spain and Poland are the fifth and sixth largest emitters in the EU-27, each accounting for 8% 
of total EU-27 GHG emissions. Spain increased emissions by 42 % between 1990 and 2008. 
This was largely due to emission increases from road transport, electricity and heat production 
and manufacturing industries. Poland decreased GHG emissions by 12.7 % between 1990 and 
2008  (-29.8%  since  the  base  year,  which  is  1988  in  the  case  of  Poland).  Main  factors  for 
decreasing emissions in Poland - as for other Central and Eastern European Member States - 
was  the  decline  of  energy  inefficient  heavy  industry  and  the  overall  restructuring  of  the 
economy in the late 1980s and early 1990s as well  as energy  efficiency improvements over 
1990-2008. The notable exception was transport, especially road transport, where emissions 
increased.  

In  2008,  seven  Member  States  had  GHG  emissions  above  base  year  levels  whereas  the 
remaining 18 Member States had emissions below base year levels. Cyprus and Malta do not 
have  emission  reduction  commitments  under  the  Kyoto  Protocol.  In  those  countries, 
emissions in 2008 were above 1990 levels. The percentage changes of GHG emissions from 
the base year to 2008 range from -54% (Latvia) to +40% (Spain).  

2.2. 

GHG intensities and emissions per capita in 2008 

Emissions  in  both  EU-15  and  EU-27  have  been  decreasing  while  the  economy  has  grown 
significantly.  This  indicates  that  a  decoupling  of  GHG  emissions  growth  from  GDP  growth 
has been taking place in the EU-15 since 1993, and in the EU-27 since 1996. Between 1990 
and 2008, GDP in the EU-15 increased by 45 % with a 6.5 % reduction of GHG emissions 
and in the EU-27 GDP grew by 46 % while emissions decreased by 11.3 %. 

All  EU  Member  States,  except  Cyprus,  Portugal  and  Spain  have  significantly  reduced  their 
emissions  while  their  economy  grew  strongly  between  1990  and  2008.  Strong  economic 
growth but decreasing emissions were in particular observed in the Member States in Central 
and  Eastern  Europe,  due  to  the  transformations  of  the  inefficient  heavy  industry  based 
manufacturing sector.  

In  2008,  in  the  EU-15  emissions  per  capita  were  on  average  at  10.1  tCO2-eq.  which  means 
they decreased by 0.2 tCO2-eq. compared to 2007, or 1.5 tCO2-eq. compared to 1990. In the 
EU-27  the  average  was  9.9  tCO2-eq.  per  capita.  However,  GHG  emissions  per  capita  show 
significant  differences  across  European  countries  ranging  from  5.2  to  25.8  tCO2-eq.  per 
capita. They are subject to the energy intensity and the energy mix of each country (see also 
figure 2 of the Staff Working Document (SWD)).  

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In the 1990s, per capita emissions decreased in the whole EU. Between 2000 and 2008, they 
decreased by 7.7 % in the EU-15 while they rose by 4.5% in the EU-12. Between 1990 and 
2008, per capita GHG emissions increased most in Spain, Portugal, Malta, and Cyprus.  

Figure  3:  GHG  intensity  for  EU-15  and  EU-27,  GDP,  energy  consumption  and  CO2 
emissions for EU-15  

)
0
0
1
=
0
9
9
1
(

x
e
d
n
I

150

140

130

120

110

100

90

80

70

60

50

1990

1995

2000

2005

Energy consumption (EU-27)

GHG/GDP (EU-27)

GHG/GDP (EU-15)

CO2 emissions (EU-27)

GDP (EU-27)

2.3. 

GHG emissions in 2008 compared to 2007 

Between  2007  and  2008,  emissions  within  the  EU-27  fell  by  99.0  MtCO2-eq.  (2%)  with  a 
decrease in the EU-15 by 75.7 MtCO2-eq. (1.9%). GHG emissions decreased or were stable in 
all EU Member States except for Belgium, Germany, Cyprus, Slovakia and Slovenia.  

Spain, the United Kingdom, Italy, Finland contributed significantly to the overall decrease of 
GHG  emissions  (-32.9  MtCO2-eq.,  -11.8  MtCO2-eq.,  -11.1  MtCO2-eq.,-7.9  MtCO2-eq., 
respectively).  Important  decreases  in  GHG  emission  took  place  also  in  Romania,  Czech 
Republic  and  Poland  (-6.7  MtCO2-eq.,  -6.1  MtCO2-eq.,  -4.3  MtCO2-eq.,  respectively).  The 
emission  decreases  were  due,  in  particular,  to  lower  public  electricity  and  heat  productions, 
road transport and lower emissions from manufacturing industries.  

Total GHG emissions grew most in Belgium (3.0 MtCO2-eq.) and Slovakia (0.9 MtCO2-eq.) 
due to increase in GHG emissions from energy sector, especially from fuel combustion. 

Remarkably, the emissions from road transport in the EU-15 decreased to a significant extent 
(–22.8  MtCO2-eq  or  –2.9 %).  All  EU-15  countries  except  Belgium,  Luxembourg  and  the 
Netherlands, reported emission decreases. The highest reductions were reported by France (–
6.3  MtCO2-eq),  Spain  (–6.2  MtCO2-eq),  Italy  (–4.8  MtCO2-eq)  where  the  use  of  biofuels 
increased strongly, and the United Kingdom (–4.3 MtCO2-eq). In addition, Czech Republic, 
Estonia, Hungary, Latvia, Lithuania and Malta reported decreases. 

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For the first time since 1992, emissions from international aviation and maritime transport fell 
in  the  EU-27  (about  1.2%  compared  to  2007),  partly  due  to  the  economic  recession.  These 
two sectors account for about 5.9% of total greenhouse  gas  emissions  in  EU-27  but  are  not 
included in the Kyoto targets.  

However, keeping control over GHG emissions from transport sector will be important in the 
future. 

2.4. 

Emission trends in the main sectors 

Figure  4  shows  that  energy  supply  and  use,  and  transport  are  the  most  important  sectors, 
accounting  for  80%  of  total  EU-15  emissions  in  2008.  Transport  is  responsible  for  21%  of 
total GHG emissions, agriculture for 10%, industrial processes for 8% and waste for 3%. 

The decreases in energy, agriculture, industrial processes and waste has been partially offset 
by  significant  increases  in  the  transport  sector  (for  further  details  see  also  the  SWD).  In 
summary, compared to 1990, emissions in the EU-15 from: 

–  energy supply decreased by 5% and energy use decreased by 13%, 

–  transport increased by 20%, 

–  industrial  processes  decreased  by  17%  mainly  due  to  lower  emissions  from  adipic  acid 

production and production of halocarbons and sulphur hexafluoride,  

–  agriculture declined by 12% due to declining cattle numbers and decreasing use of mineral 

fertiliser and manure, 

–  waste decreased by 40% due to lower CH4 emissions from managed landfills. 

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Figure 4: Change in EU-15 GHG emissions by sector and share of sectors  

Change in sectoral emissions 1990-2008

Energy supply

Energy use
Transport

Industrial processes
Agriculture

Waste
Solvents and other

Sectoral change in EU-15, 1990-2008

-5%

-13%

-17%

-12%

-40%

-28%

20%

-60% -40% -20%

0%

20%

40%

60%

Share by sector in EU-15, 2008

Solvents 
and other
0%

Waste
3%

Energy 
supply
29%

Agriculture
10%

Industrial 
processes
8%

Transport
21%

Energy 
use
29%

Source: EEA

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3. 

3.1. 

PROJECTED PROGRESS TOWARDS MEETING THE KYOTO TARGET 

Projections of GHG emissions  

The  assessment  of  the  progress  towards  meeting  the  Kyoto  commitments  is  based  on 
PRIMES/GAINS projections except for Denmark and Ireland both of which provided fully updated 
and complete projections in 2010. For more details see tables 7 and 8 in the SWD. 

3.1.1.  EU-15  

Figure  5  presents  the  projections  for  non-ETS  sectors  and  assesses  the  gaps  between  projected 
emissions and the target in those sectors. The aggregate projections for all sectors estimate that total 
GHG  emissions  of  the  EU-15  are  likely  to  be  10.4%  below  base-year  levels  in  the  commitment 
period, i.e. the EU-15 would over-achieve its Kyoto target by 2.4 %. When including the,  

(1) 

(2) 

government use of the Kyoto mechanisms which is expected to deliver an additional 2.7% 
emission reduction, and 

total removal due to activities referred to in Art. 3.3 and 3.4 of the Kyoto Protocol in the 
EU-15 corresponding to a 1.0% reduction 

the  EU-15  is  projected  to  reduce  its  emissions  even  further.  Assuming  that  all  these  measures 
deliver  as  expected,  the  projected  overall  reduction  of  GHG  emissions  could  be  up  to  14.2%  in 
commitment period compared to base year levels.  

Given, however the EU's ambitious reduction target of 20% by 2020 compared to 1990 and in order 
to pave the way for a smooth compliance with this target, it is imperative that Member States not 
only  ensure  timely  delivery  of  emissions  reductions  from  existing  policies  and  measures  but  also 
that  they  accelerate  the  development  and  full  implementation  of  their  additional  policies  and 
measures.  

3.1.2.  EU-12  

Aggregate emissions based on existing domestic policies and measures from the other 12 Member 
States are projected to slightly decrease compared to 2008 and will be about 36.8% below their base 
year  levels  in  the  commitment  period.  Slovenia  is  the  only  Member  State  out  of  the  EU-12  that 
intends to invest in Kyoto mechanisms. Slovenia, the Czech Republic, Hungary and Poland intend 
to account for carbon sinks. Czech Republic, Hungary, Latvia and Slovakia plan to sell part of their 
Assigned Amount Units ( AAUs) surplus.  

3.1.3.  EU-27  

In  the  commitment  period,  total  EU-27  GHG  emissions  are  projected  to  be  about  17.3%  below 
base-year levels. This estimation is based on PRIMES/GAINS projections which takes into account 
existing polices and measures. The projected decline is even bigger when the effect of acquisitions 
of credits via the Kyoto mechanisms by governments and carbon sinks is accounted for. 

However,  these  emission  projections  need  to  be  considered  in  the  perspective  of  the  effective 
reductions  already  achieved,  which  amount  to  -11.3%  for  the  EU-27  between  1990  and  2008  as 
well as projections by 2020. Therefore, reduction efforts will need to accelerate across the EU in the 
future if the EU is to meet its -20% or -30% target by 2020. 

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Figure  5:  Relative  gaps  (over-delivery  or  shortfall)  between  GHG  projections  in  the  non-ETS 
sectors for the commitment period and the respective 2008-2012 targets based on projections and 
the use of Kyoto mechanisms and carbon sinks.  

EU-15

Sweden

United Kingdom

Greece

Portugal

France

Germany

Netherlands

Finland

Luxembourg

Belgium

Spain

Ireland (1)

Denmark (1)

Italy

Austria

Estonia

Lithuania

Bulgaria

Romania

Hungary

Poland

Latvia

Czech Republic

Slovenia

Slovakia

-1,2%

-5,0%

-12,1%

-15,0%

-9,8%
-10,3%

-7,8%

-8,9%

-8,8%

-5,5%
-6,2%

-4,4%
-4,8%

-4,6%

-0,9%

-3,7%

-2,5%

-2,0%

-1,8%

-0,2%

7,0%

1,6%

0,9%

0,0%

1,5%

7,7%

8,0%

6,7%

8,7%

26,3%

20,0%

21,0%

-48,8%

-40,4%

-38,5%

-35,8%

-31,0%

-28,5%

-23,4%
-23,9%

-45,1%

-14,2%

-15,9%

-13,9%

-3,6%

-1,2%

-0,8%

10,2%

-60%

-50%

-40%

-30%

-20%

-10%

0%

10%

20%

30%

40%

Percentage points over-delivery (-) or shortfall (+) (in share of base-year emissions)

Projections of non-ETS emissions

Projections of non-ETS emissions with carbon sink removals and use of Kyoto mechanisms

Note: (1) For Denmark and Ireland national projections were used for the estimate; (2) For all the other MS, (excluding 
Cyprus and Malta which do not have emission reduction commitments under the Kyoto Protocol) estimates were based 
on PRIMES/GAINS projections; (3) Use of unused allowances from the NER under the EU ETS was taken into account 
for those MS which indicated plans to use them for non-ETS compliance (Denmark and Ireland) 
Source: European Commission

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3.2. 

Implementation of the EU climate change policy 

The European Climate Change Programme (ECCP) 

Across  the  EU-27,  an  assessment  of  Member  States'  policies  and  measures  identified  eight 
Common and Coordinated Policies and Measures (CCPMs) that are projected to deliver 
significant GHG emissions savings in the EU. The largest savings can be expected from the 
EU  ETS  Directive  (2003/87/EC)  and  the  Renewables  Directive  (2009/28/EC)  promoting 
electricity  produced  from  renewable  energy  sources.  In  the  transport  sector,  fuel  quality 
legislation  and  reduction  of  CO2  from  cars  are  of  significant  importance.  Further,  energy 
demand  will  be  reduced  through  the  implementation  of  the  Directives  on  the  energy 
performance of buildings, ecodesign requirements, energy taxation and the promotion of co-
generation (combined heat and power). Finally, the Kyoto Protocol's flexible mechanisms are 
projected to deliver significant GHG emissions savings. 

In addition to these eight key policies and measures, a further five CCPMs were identified 
that are also predicted to deliver important savings across the EU. These five policies are the 
Landfill  Directive  (99/31/EC),  the  efficiency  standards  for  new  hot-water  boilers,  the 
Directive on labelling of appliances (2000/13/EC), Directive 2008/1/EC concerning integrated 
pollution prevention and control (IPPC) being amended by the Industrial Emissions Directive 
and the Motor Challenge programme, aimed at improving the energy efficiency of industrial 
electric motors. The F-Gas Regulation (842/2006/EC) and the MAC Directive (2006/40/EC), 
at the time of their adoption, were also expected to reduce projected annual GHG emissions 
by 23 Mt CO2-eq by 2010. The actual impact of these two instruments also in terms of GHG 
emission reductions is currently being reviewed. 

The top eight policies account for 92% of the total savings attributed to CCPMs in the EU-27. 
This  underlines  the  importance  of  these  key  policies  in  helping  Member  States  to  achieve 
their emission reduction commitments.  

Recent developments 

Since the adoption of the climate and energy package, work on implementation measures is 
ongoing. By 2013, about twenty new legal acts and documents have to be in place in order to 
ensure  proper  functioning  of  the  revised  EU  ETS  as  well  as  to  prepare  the  ground  for  the 
implementation of GHG emission targets in the non-ETS sectors.  

Currently,  work  on  developing  Community-wide  harmonized  allocation  rules  for  allocating 
allowances  for  the  third  period  is  under  preparation.  The  allocation  will  be  to  the  extent 
feasible based on ambitious benchmarks, which will encourage innovation and reward more 
efficient installations that have invested in low-carbon ways of production. The Commission 
Regulation  on  the  timing,  administration  and  other  aspects  of  auctioning  of  greenhouse  gas 
emission  allowances  has  been  agreed  by  Member  States  in  July  2010.  The  Registries 
Regulation has also been revised in order to establish the new ETS single registry. Measures 
against Certified Emission Reduction (CER) recycling and against fraud by improving access 
controls and security have been taken swiftly. 

In  2009,  work  on  implementing  measures  under  the  Effort  Sharing  Decision  commenced 
which  include  determining  the absolute  values  for  Member  States  targets  in  2013-2020  and 
setting  rules  for  transfers  of  annual  emission  allocations  among  Member  States  and  ensure 
their transparency. 

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The  NER300  Decision  laying  down  criteria  and  measures  for  the  financing  of  large-scale 
commercial  demonstration  Carbon  Capture  and  Storage  (CCS)  projects  and  innovative 
renewable energy technologies under the revised EU ETS has been developed and should be 
formally  adopted  soon.  Also  the  preparation  of  guidance  documents  on  various  elements  of 
CCS  Directive  to  allow  for  its  harmonised  implementation  is  on-going  and  expected  to  be 
finalised by the end of 2010.  

Work  on  the  implementation  measures  of  the  Regulation  (EC)  443/2009  regulating  CO2 
emissions from cars is ongoing too.  

Legal acts recently adopted 

Implementation of the climate and energy package: 

(1) 

(2) 

(3) 

(4) 

(5) 

Other: 

leakage:  Commission  Decision  2010/2/EU7 
EU  ETS  and  carbon 
determining a list of sectors and subsectors which are deemed to be exposed 
to a significant risk of carbon leakage. 

EU ETS total cap: Commission Decision 2010/384/EU8 on the Community-
wide  quantity  of  allowances  to  be  issued  under  the  EU  Emission  Trading 
Scheme for 2013. 

CCS  in  EU  ETS:  Commission  Decision  2010/345/EU9  amending  Decision 
2007/589/EC as regards the inclusion of monitoring and reporting guidelines 
for  greenhouse  gas  emissions  from  the  capture,  transport  and  geological 
storage of carbon dioxide.  

Aviation  and  EU  ETS:  Commission  Regulation  (EU)  No  82/201010 
amending  Regulation  (EC)  No  748/2009  on  the  list  of  aircraft  operators 
which  performed  an  aviation  activity  listed  in  Annex  I  to  Directive 
2003/87/EC on or after 1 January 2006 specifying the administering Member 
State for each aircraft operator. 

Aviation and EU ETS: Commission Regulation (EU) No 606/201011 on the 
approval of a simplified tool developed by the European organisation for air 
safety  navigation  (Eurocontrol)  to  estimate  the  fuel  consumption  of  certain 
small emitting aircraft operators.  

3.3. 

Implementation of the EU Emissions Trading System (EU ETS) 

The first period of the EU ETS covered the years 2005-2007. Currently, operators subject to 
the EU ETS are in the middle of the second trading period (2008-2012). In 2013, a revised 
system  will  begin  its  operation.  For  more  information  on  the  implementation  of  the  revised 
EU ETS see section 3.2. 

3.3.1. 

Second trading period (2008-2012) 

The EU-wide cap for 2008-2012 amounts to 2.081 billion allowances per year, 10.5% lower 
than  what  was  initially  proposed  in  the  national  allocation  plans  submitted  by  the  Member 
States. In 2009, 11,032 installations participated in the system.  

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The total amount of verified emissions in 2009 from EU ETS installations in the EU-27 was 
1.85  billion  tonnes12  of  CO2,  almost  12%  lower  than  in  2008.  The  drop  of  emissions  is 
attributed to three main factors, i.e. reduced economic activity as a result of the recession, low 
level of gas prices throughout 2009, as well as reduction measures undertaken by installations.  

3.3.2.  Use of JI and CDM by operators 

As  part  of  the  second  National  Allocation  Plans  (NAPs),  a  limit  was  established  by  each 
Member  State  for  the  maximum  use  of  project-based  credits  by  operators  (Joint 
Implementation (JI) and Clean Development Mechanism (CDM)). In total, up to 278 million 
CERs or Emission Reduction Units (ERUs) may be used per year by ETS installations from 
all Member States in the second trading period, which corresponds to 13.4 % of the EU-wide 
cap for this period. In 2009, operators used 82 million CERs or ERUs which was 4.39% of all 
surrendered allowances. From 2013 onwards the rules for the use of JI and CDM credits will 
be revised as set in the revised EU ETS Directive.13 

3.4. 

Projected use of Kyoto mechanisms by government  

Ten  Member  States  of  the  EU-15  as  well  and  Slovenia  have  decided  to  use  Kyoto 
mechanisms  to  reach  their  Kyoto  targets.  Together,  these  EU-15  Member  States  would 
acquire  116.7  Mt CO2-eq.  per  year  for  compliance  under  the  first  commitment  period  under 
the Kyoto Protocol. This represents approximately 2.7 percentage points towards the EU-15 
Kyoto target of -8 % (see Table 12  in  the SWD). However,  when looking at the amount of 
credits already delivered to the Member States' accounts in the registry, so far, the figure is 
much smaller and amounts to about 28 Mt CO2-eq. 

These  10  Member  States  together  have  decided  to  invest  about  € 3  billion  to  acquire  units 
through  JI,  CDM  or  emissions  trading.  Spain,  Austria,  the  Netherlands,  Luxembourg  and 
Portugal  allocated  the  largest  budgets  (€   638  million,  €  531  million,  €  507  million,  €  360 
million and € 305 million, respectively, for the five-year commitment period). In Slovenia, the 
budget has been estimated for € 80 million.  

As regards AAUs sold by Member States, according to data in the registry about 56 Mt CO2-
eq. have been transferred. Czech Republic, Hungary, Latvia and Slovakia reported that they 
intend to sell credits.  

3.5. 

Projected use of carbon sinks  

In addition to the policies and measures targeting various sources of GHG emissions, Member 
States can make use of carbon sinks (see Table 13 in the SWD). The information provided so 
far indicates that the total net sequestration during the commitment period from afforestation 
and reforestation activities under Art. 3.3 of the Kyoto Protocol will be about 12.1 MtCO2 per 
year for the EU-15. In addition, the use of activities under Art.3.4 is projected to contribute 
27.7 MtCO2 per year of the commitment period in the EU-15 and will amount to 34.2 MtCO2 
per year taking into account contributions from EU-12. 

Together,  activities  under  Art.  3.3  and  3.4  in  the  EU-15  Member  States  are  projected  to 
reduce  emissions  by  42.5  Mt CO2  per  year  of  the  commitment  period  equivalent  to  about 
12.5% of the EU-15 reduction commitment of 341 Mt CO2 per year during the commitment 
period compared to base year emissions.  

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4. 

MEETING THE 2020 TARGET 

4.1. 

EU GHG emission reduction target by 2020  

The  Climate  and  Energy  package  set  a  20%  GHG  emission  reduction  target  for  EU-27  by 
2020. Total EU effort to reduce greenhouse gas emissions by 20% compared to 1990 by 2020 
(which also accounts to -14% compared with 2005) will be divided between the EU ETS and 
non-ETS sectors as follows:  

(a) 

(b) 

21% reduction in EU ETS sector emissions compared to 2005;  

reduction of around 10% compared to 2005 for the sectors that are not covered 
by the EU ETS.  

These greenhouse gas emissions reduction targets were included in the Europe 2020 strategy 
for jobs and smart, sustainable and inclusive growth adopted by the European Council in June 
2010.  The  Europe  2020  strategy  will  require  tracking  progress  towards  the  targets  on  an 
annual basis. 

4.2. 

Policies contributing to the fulfilment of targets 

The emission caps from 2013 until 2020 are defined in the Effort Sharing Decision and the 
revised  ETS  Directive.  In  parallel,  other  EU-wide  policies  will  contribute  to  reaching  the 
targets  by  Member  States,  such  as  the  binding  targets  for  renewable  energy,  the  emission 
performance  standards  for  new  passengers  vehicles,  the  CCS  Directive  or  the  Fuel  Quality 
Directive.  On  top  of  these  EU-wide  policies,  national  policies  will  play  an  important  role, 
especially for the reduction of non-ETS emissions.  

4.3. 

Projected distance to targets 

As shown in table 1 and according to the Commission's latests projections that incorporate the 
effect of the economic crisis, implemented national policy measures as of 2009 would not be 
sufficient to reach the EU emission reduction targets in the year 2020. 

Table 1: EU-27 internal GHG emission reductions in the baseline 

EU27 baseline scenario 

Total GHG Non-ETS sectors

Total GHG emissions 2005-2020 

-7% 

Reduction targets 2005-2020 

-14% 

-3.5% 

-10% 

Note: For more details on projections see COM(2010) 265 final and the accompanying Staff Working Document 
SEC(2010) 650, Part 2 
Source: European Commission 

Despite  the  positive  trends  towards  KP  commitment  achievement  shown  by  2008-2012 
projections,  more  effort  and  additional  policies  will  be  necessary  to  achieve  the  2020 
objectives. The flexibilities provided for in the Effort Sharing Decision and the revised ETS 
Directive,  such  as  the  use  of  project  credits,  will  also  contribute  to  the  attainment  of  the 
targets. 

Total EU-27 non-ETS GHG emissions are projected to decrease by 3.5% between 2005 and 
2020 according to the PRIMES-GAINS baseline (see table 1). This decrease is mainly driven 
by non-CO2 emissions reductions of around 8% and a stabilisation of CO2 emissions, which 

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see a decrease of around 1%. As expected, in the year 2020 the EU level non-ETS target of 
around -10% is unlikely to be achieved. Without use of JI/CDM the distance to target at EU 
level  is  around  6%  (see  figure  6),  hence  additional  measures  will  still  be  necessary,  with 
synergies between the implementation of the Renewables Directive and of the Effort Sharing 
Decision.  Ten  Member  States  are  projected  to  meet  their  non-ETS  target  already  with  the 
current  set  of  policies  and  measures  as  illustrated  with  a  "-"  in  the  figure  6.  These  are 
Bulgaria, Czech Republic, Estonia, Greece, Hungary, Latvia, Lithuania, Malta, Portugal and 
Romania. According to PRIMES/GAINS projections, seventeen Member States including the 
eight largest non-ETS emitters and the EU-27 as a whole would miss their non-ETS targets. 

Figure 6: Projected gap to 2020 targets for non-ETS sectors  

Austria
Belgium
Bulgaria
Cyprus
Czech Republic
Denmark
Estonia
Finland
France
Germany
Greece
Hungary
Ireland
Italy
Latvia
Lithuania
Luxembourg
Malta
Netherlands
Poland
Portugal
Romania
Slovakia
Slovenia
Spain
Sweden
United Kingdom
EU27

-21%

-9%

-8%

-1%

-2%

6%

7%

3%

13%

15%

13%

18%

-18%

-11%
-11%

-12%

-10%

10%

7%

4%

4%

9%

2%

6%

25%

24%

26%

19%

-30%

0%

30%

Distance between projected 2020 emissions and 2020 Effort sharing target without JI/CDM (in percent, shortfall indicated by positive values)

Source: European Commission; non-ETS sector scope as of 2013, i.e. excluding also ETS sectors which only 
enter the ETS by 2013, to enable data comparabillity over time 

5. 

SITUATION IN THE EU CANDIDATE COUNTRIES 

Between  199014  and  2008  Croatia's  GHG  emissions  decreased  by  0.6%  and  compared  to 
2007  decreased  by  3.7%.  According  to  the  GHG  projections  included  in  the  5th  National 
Communication, Croatia is projected to face difficulties with achieving its Kyoto target with 
the current set of policies and measures. 

Iceland's  GHG  emissions  between  1990  and  2008  increased  by  44%  and  in  2008  were  9% 
higher than in 2007. Taking into account decision 14/CP.7, according to the GHG projections 
included in the 5th National Communication, Iceland is on track to meet its Kyoto target.  

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In  2008,  Turkey’s  GHG  emissions  were  366.5  MtCO2-eq  compared  to  187  MtCO2-eq.  in 
1990, so increased by 96% and comparing to 2007 decreased by 3.5%. Turkey has no GHG 
limitation commitment under the Kyoto Protocol. 

An up-to-date inventory of GHG emissions in the former Yugoslav Republic of Macedonia 
is  not  available.  Most  recent  GHG  data  is  included  in  the  2nd  National  Communication  and 
covers  the  period  1990-2002.  Between  1990  and  2002  total  GHG  emissions  decreased  by 
around 10%. 

For more information please see section 2 of the SWD. 

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