REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL PROGRESS TOWARDS ACHIEVING THE KYOTO AND EU 2020 OBJECTIVES (required under Article 21 of Regulation (EU) No 525/2013 of the European Parliament and of the Council of 21 May 2013 on a mechanism for monitoring and reporting greenhouse gas emissions and for reporting other information at national and Union level relevant to climate change and repealing Decision No 280/2004/EC)
Date: 2013-10-09
Institutions: European Commission
Subjects: Kyoto Protocol, climate change policy, disclosure of information, environmental statistics, greenhouse gas, reduction of gas emissions













EUR-Lex - 52013DC0698 - EN











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52013DC0698

REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL PROGRESS TOWARDS ACHIEVING THE KYOTO AND EU 2020 OBJECTIVES (required under Article 21 of Regulation (EU) No 525/2013 of the European Parliament and of the Council of 21 May 2013 on a mechanism for monitoring and reporting greenhouse gas emissions and for reporting other information at national and Union level relevant to climate change and repealing Decision No 280/2004/EC) /* COM/2013/0698 final */









REPORT FROM THE COMMISSION TO THE
EUROPEAN PARLIAMENT AND THE COUNCIL
PROGRESS TOWARDS ACHIEVING THE KYOTO AND
EU 2020 OBJECTIVES

(required under Article 21 of
Regulation (EU) No 525/2013 of the European Parliament and of the Council of 21
May 2013 on a mechanism for monitoring and reporting greenhouse gas emissions
and for reporting other information at national and Union level relevant to
climate change and repealing Decision No 280/2004/EC)
TABLE OF CONTENTS
REPORT FROM THE COMMISSION TO THE EUROPEAN
PARLIAMENT AND THE COUNCIL PROGRESS TOWARDS ACHIEVING THE KYOTO AND EU 2020
OBJECTIVES................................... 1
1........... Summary........................................................................................................................ 3
2........... Actual progress 1990-2011............................................................................................ 6
2.1........ GHG emissions trends in Member
States......................................................................... 6
2.2........ GHG intensities and emissions per
capita in 2011............................................................ 7
2.3........ GHG emissions in 2011 compared to
2010..................................................................... 8
2.4........ Emission trends in the main
sectors.................................................................................. 9
3........... Progress towards meeting the
Kyoto target................................................................... 10
3.1........ First Commitment Period (2008-2012)......................................................................... 10
3.1.1..... EU-28.......................................................................................................................... 10
3.1.2..... EU-15.......................................................................................................................... 11
3.1.3..... EU-11.......................................................................................................................... 11
3.2........ Projected use of Kyoto mechanisms
by Operators and Union's governments.................. 12
3.3........ Projected use of carbon sinks....................................................................................... 13
4........... Progress toward the 2020 target................................................................................... 13
4.1........ Union's GHG emission reduction
target by 2020............................................................ 13
4.2........ Projected distance to targets......................................................................................... 14
5........... State of implementation of the
Union's climate change policy.......................................... 16
5.1........ Reducing emissions....................................................................................................... 16
5.2........ Adaptation to climate change........................................................................................ 19
5.3........ Climate Finance............................................................................................................ 20
5.4 Climate research & innovation
6........... Situation in the Union's
candidate and potential candidate countries................................ 20
1.           Summary
Overaccomplishing the Kyoto target,
2008-2012
In 2011, total EU-28 greenhouse gas (GHG)
emissions without emissions and removals from Land Use, Land Use Change and
Forestry (LULUCF) and excluding emissions from international aviation were 18.3 %
lower compared to 1990 levels. GHG emissions continue to follow the general
decreasing trend seen from 2004 onwards. Emissions in 2011 reached their lowest
levels since 1990.
According to the most recent inventory data
in 2011 the EU-15 and EU-28 GHG emissions decreased by 4.2 %
and 3.3 % respectively compared to 2010. The 2011
emissions decrease was largely due to a milder winter in 2011 compared to 2010,
which led to a lower demand for heating. This decline followed a small increase
in 2010, partially due to the economic recovery, that came after a sharp drop
in 2009 largely due to the effects of the 2008 economic crisis. Preliminary
estimates show that EU-15 and EU-28 emissions further decreased by respectively
0.5 % and 1.3 % in 2012. 
Under the Kyoto Protocol, the EU-15 has
agreed to reduce its GHG emissions by 8 % by 2008–12 compared to base year
levels. Based on the latest available inventory data for 2011, total GHG
emissions in the EU-15 as shown in Figure 1 were 14.9 % below base year levels
(without LULUCF). The EU-15 is therefore not only on track to achieve its Kyoto
target for the first commitment period from 2008-2012, but will overachieve it.
Over and above the EU-15 Kyoto target, an accumulated amount of 0.9 Gt CO2
eq. will have been saved during the first commitment period. Despite the fact
that emissions were below the EU-15 Assigned Amount, EU-15 Member States and
companies located in these Member States offset part of their emissions with emission
reduction credits bringing the overachievement to a total of 1.6 Gt CO2
eq., almost doubling the reduction effort compared to the initial Kyoto target.
GDP growth for the period 1990-2011 was 44 % for the
EU-15 and 45 % for the EU-28.
While the economy grew significantly emissions
decreased demonstrating the decoupling between economic growth and GHG
emissions. Accordingly, between 2010 and 2011 the EU-28 GDP increased by 1.4%,
while GHG emissions fell by 3.3 %. 
Figure 1: Actual emissions
(MtCO2-eq.) for EU-15
Note: The arrows are based on an average of
inventory emission data for the period 2008-2012 (2012 emissions are based on
proxy estimates). 
Source: European Commission, EEA
According to the GHG inventory data from 2011,
eight EU-15 Member States (Finland, France, Germany, Greece, Ireland, Portugal,
Sweden and the United Kingdom) are likely to achieve their individual GHG
reduction targets through domestic emission reductions only, as shown in Figure
6. Ireland and Portugal are expected to achieve their targets with the use of
carbon sinks. Austria, Belgium, Denmark, the Netherlands and Spain could meet
their target by using Kyoto flexible mechanisms. Taking into account the use of
Kyoto credits as it is currently planned, Luxembourg is not yet on track to
achieve its target (by a 1.7 % gap) and for Italy, the present shortfall
is small (by 0.7 %) (see Figure 6). Both shortfalls can be addressed
during the true-up period[1].

In most of the thirteen Member States which
acceded to the Union as from 2004, emissions are reported to have slightly
increased between 2009 and 2012. However, based on the data currently
available, all these eleven Member States that have a Kyoto target are expected
to meet or over-achieve their commitments. It is estimated that for the 1st
commitment period these Member States overachieved their Kyoto targets by a
total of 2.4 Gt CO2 excluding LULUCF and emission reduction credits.
The remaining two Member States, Cyprus and Malta, have no obligations under
the Kyoto Protocol’s first commitment period. 
On track to reach the Europe 2020
target and the Kyoto target 2013-2020
As of 1st January 2013, all EU
Member States implement the subsequent obligations taken under the 2nd
commitment period of the Kyoto Protocol which will run from 2013 until 2020.
This decision was taken at the Doha climate conference in December 2012. The Climate
and Energy package[2]
adopted in 2009 provides an integrated package of policies and measures to implement
the new obligations under Kyoto's 2nd commitment period and to tackle
climate change until 2020 and beyond. It also forms one of the five headline
targets of the Europe 2020 strategy for jobs and smart, sustainable and
inclusive growth demonstrating that climate action is fully integrated into the
EU's overarching policies. 
The total effort of the Union to reduce
greenhouse gas emissions by 20 % by 2020 compared to 1990 is divided
between the EU ETS and non-ETS sectors. With regard to the EU ETS, the phase 3 (2013-2020) preparation has
been succesfully finalised before 1st January 2013, including the procurement
of the auction platforms, the Single Union Registry and harmonised rules on
monitoring, reporting, accreditation and verification. 
As regards sectors not covered by the EU
ETS, pursuant to the Effort Sharing Decision[3]
(‘ESD’), each Member State has individual binding annual emission limits for
the period 2013-2020. While the EU is on track to meet its overall 2020 target
for sectors not covered by the EU-ETS, 13 Member State need to implement additional
policies to meet their individual 2020 targets. The monitoring of the state of
implementation of the non-ETS obligations is particularly ensured under the
European Semester[4].
In 2011, EU-28 emissions (including international
aviation) were 16.9 % below 1990 level. According to approximated data for
2012, emissions further decreased by 1 % in 2012 and were subsequently 18 %
lower than in 1990.
Figure 2 displays the EU’s emission data
from the inventory until 2011, approximate emission data for 2012[5] and projection data until 2020
(excluding international aviation). It illustrates the emission
reduction effort excluding international aviation required by 2020 under the
Climate and Energy Package (Package target path). The target for the first
Commitment Period (2008-2012) is defined as the sum of the EU-15 collective target
and of the individual targets of the other Member States[6]. The EU-28 target for the
second Commitment Period (2013-2020) corresponds to a 20% reduction of
emissions compared to the sum of base year emissions[7]. 
According to the latest available GHG projections
which include the implementation of the Climate and Energy Package, the EU
would collectively meet its 2020 target (see Figure 7). 
Figure 2:
Actual emissions (MtCO2-eq.) for EU-28 (without international
aviation and LULUCF). 
Note:      (*) defined as the sum of EU-15’s collective target
and EU-13 national individual targets (average 2008-2012
(proxy data) emissions for Malta and Cyprus)
(**) defined as the sum of Member States’ annual
emission allocations under the ESD and ETS cap excluding international
aviation.
Source: European Commission, EEA
2.           Actual
progress 1990-2011
2.1.        GHG
emissions trends in Member States
The overall EU GHG emission trend remains strongly
influenced by the trends of the two largest emitters, Germany and the United
Kingdom, accounting for about one third of total EU emissions. These two Member
States have achieved total GHG emission reductions of 539 Mt CO2-equivalents
compared to the Kyoto base year. The main reasons for the favourable trend in
Germany were increasing efficiency in power and heating plants, increases in
the share of renewable energies and the economic modernisation of the five new
Länder after German reunification. The reduction of GHG emissions in the United
Kingdom was primarily the result of switches from oil and coal to natural gas
in electricity production and N2O emission reduction measures in the
production of adipic acid. 
In 2011, Italy was the third largest
emitter in the EU (accounting for 10.7 % of the EU-28 total), slightly
above France (with a share of 10.6 %). Italy's GHG emissions were 5.4 %
below 1990 levels in 2011. Between 1990 and 2004, emissions in Italy increased
primarily from road transport, electricity and heat production and petroleum
refining but since then the country's total GHG emissions decreased by more
than 15 %. France's emissions were 12.7 % below 1990 levels in 2011.
In France, large reductions were achieved in N2O emissions from
adipic acid production, but CO2 emissions from road transport
increased between 1990 and 2011. 
Poland and Spain remain the fifth and sixth
largest emitters in the EU‑28, accounting respectively for 8.7 % and
7.7 % of total GHG emissions in 2011. Poland decreased its emissions by 12.6 %
between 1990 and 2011, and by 29.1 % since the base year (1988). The main
factors for decreasing emissions in Poland — as for other new Member States —
were the improvement of the energy efficiency of heavy industries and the
overall modernisation of the economy in the late-1980s and early 1990s. The
notable exception was transport (especially road transport) where emissions
increased significantly. Spain increased emissions by 23.9 % between 1990
and 2011 and by 21 % since the base year. This was largely due to emission
increases from road transport, electricity and heat production, and
manufacturing industries.
In 2011, twenty-one Member States had
emissions below base-year levels. Spain, Portugal, Greece, Austria and Ireland had
GHG emissions above base-year levels (mostly 1990). Cyprus and Malta do not
have emission reduction commitments under the Kyoto Protocol's first commitment
period. In those two Member States, emissions in 2011 were around 50 % above
1990 levels. The percentage changes of GHG emissions from the base year to 2011
range from -56 % (Lithuania) to +21 % (Spain). 
2.2.        GHG
intensities and emissions per capita in 2011
Emissions in both the EU-28 and the EU-15
have been decreasing while the economy has grown significantly. Figure 3
demonstrates that the decoupling of economic growth from GHG emissions has been
progressing steadily since 1990.
Figure 3: Evolution
of GDP (in real terms), GHG emissions and emission intensity (ie. ratio of
greenhouse gas emissions produced to GDP) – Index (1990 = 100)
Source: EEA, DG ECFIN (Ameco database), Eurostat
Between 1990 and 2011, the EU-28 GDP grew
by 45 % while emissions decreased by 18.3 %. The EU-15 GDP increased
by 44 % with a 14.9 % reduction of GHG emissions. Between 2010 and 2011,
the EU-28 GDP increased by 1.4%, while GHG emissions fell by 3.3 %. 
The overall GHG emissions intensity (i.e.
emissions per unit of economic output) for the EU-28 has been steadily
decreasing since 1990, reaching nearly half the 1990 levels by 2011 (see Figure
3). 
Between 1990 and 2011 the GHG emission intensity
decreased in all Member States. The deepest decrease was observed in Slovakia
and Estonia (-66 % respectively), Romania, Lithuania and Ireland (-62 %),
and Poland (-60 %). The smallest changes took place in Croatia (-18 %),
Portugal (-20 %), Italy, Greece and Malta (-23 % respectively) and
Spain (-24%). 
In 2011, in the EU-28 emissions per capita were
at the level of 9 tonnes CO2-eq. Per capita emissions decreased by 23 %
compared to 1990. However, 2011 GHG emissions per capita continue to show
significant differences across Member States ranging from 5.5 (Latvia) to 23.6
(Luxembourg) tCO2-eq. They are to a large extent determined by the
energy intensity and the energy mix of each country. Trends since 1990 in per
capita emissions differ greatly across Member States as well. Since 1990,
largest per capita reductions (more than 20 %) have been made in Member
States in Central and Eastern Europe, Luxembourg, United Kingdom, Germany, Denmark,
Sweden, France, Ireland and Belgium. In Cyprus, Malta, Portugal, Slovenia and
Spain per capita emissions have increased since 1990. Per capita emissions in
these Member States, however, are lower than the Union's average except for Cyprus
(see also figure 2 of the Staff Working Document (SWD)).
2.3.        GHG
emissions in 2011 compared to 2010
European GHG emissions (EU-28) decreased in
2011 by 3.3 % (representing 155.3 MtCO2-eq) mainly due to milder
winter conditions in Europe and a reduced demand for heating. In 2011,
emissions fell to their lowest levels since 1990. This decrease follows an increase
in emissions in 2010 (+2.4 %). The 2010 increase following a sharp decline
in 2009 (-7.1%) is mainly due to the effects of the economic rebound and a
colder than usual winter (see also Figure 1). 
In 2011, the sector that exhibited the
largest decrease (over 106 Mt CO2-eq) and contributed the most to
the overall EU-28 reduction vis-à-vis the previous year was the 'residential
and commercial' sector. A warmer winter and lower demand for heating were the
key reasons behind this trend. The second largest decrease came from the 'public
electricity and heat production' sectors (nearly 20 Mt CO2-eq.),
followed by the 'manufacturing industries and construction' (about 12 Mt CO2-eq.)
sector. Altogether these three sectors accounted for 89 % of the total EU
reduction over 2010/2011.
In percentage terms, seven Member States
showed an increase compared to 2010: Bulgaria (9.6 %), Romania (5.8 %),
Estonia (4.8 %), Lithuania (2.3 %), Malta (0.8 %), Spain (0.5 %)
and Slovenia (0.1 %). The remaining twenty-one Member States showed reductions
of GHG emissions, with the most significant relative drops occurring in Finland
(-10.1 %), Belgium (-8.8 %), Denmark (-8.1 %), the Netherlands
(-7.1 %) and the United Kingdom (-7 %). 
2.4.        Emission
trends in the main sectors
Energy supply and use including transport
are the most important sectors accounting for 79 % of the Union's total emissions
in 2011. Agriculture is responsible for 10 % of the total GHG emissions,
industrial processes for 7 % and waste for 3 %. Solvent and others
account for less than 0.3 % of total emissions as illustrated by figure 4
below:
Figure
4: Share of emissions by sector in the EU-28
Source: 2012 national inventories, EEA
Since 1990, the decreases in energy,
agriculture, industrial processes and waste have been partially offset by
significant increases in the transport sector (for further details see also the
Staff Working Document in Annex). However, total transport emissions have also been
decreasing since 2007. 
Figure 5:
Change in EU-28 GHG emissions by sector and share of sectors in total GHG
emissions.
Source: 2012 national inventories, EEA
According to projections based on existing
measures, emissions from energy supply will further decrease between 2011 and 2020,
mainly due to the renewable energy policy and the ETS. Emissions from energy
use and, to a lesser extent, from transport are also projected to decrease. For
transport, it is expected that the increasing demand will be compensated by the
improvement of the efficiency of the means of transport and also to a limited
extent by the promotion of rail. Emissions from agriculture are projected to remain
almost stable until 2020. According to national projections, emissions in the
industrial sector will start increasing again. Emissions from waste will continue
to decrease while those from solvents and other sectors will increase. 
3.           Progress
towards meeting the Kyoto target
3.1.        First
Commitment Period (2008-2012) 
3.1.1.     EU-28
In 2011, total EU-28 GHG emissions were 18.3 %
below 1990 levels. This estimate is based on Member States’ inventory data, as
reported to the Commission (EU-27) and the UNFCCC inventory submission by Croatia.
This decline is even bigger when the effect of acquisitions of credits via the Kyoto
mechanisms by governments and carbon sinks are taken into consideration.
3.1.2.     EU-15 
According to the latest inventory data, the
total GHG emissions of the EU-15 were on an annual average 14.9 % below
base year levels by 2011 and 12.2 % below base-year level over the first
Commitment Period (2008-2012)[8].
Furthermore, when including, 
(1)          the government use of the Kyoto
mechanisms which is expected to deliver an additional 1.9 % emission
reduction (cf. para. 3.2), and
(2)          the total removal of carbon sinks
due to activities referred to in Art. 3.3 and 3.4 of the Kyoto Protocol in the
EU-15 corresponding to a 1.5 % reduction (see section 3.3),
the EU-15 is expected to have reduced its
emissions by 15.5 % over the first commitment period. The EU-15 is
therefore on track to almost double its reduction target for the first
comitment period under the joint
fulfillment agreement under the Kyoto Protocol.
3.1.3.     EU-11 
By 2011, the other eleven countries with
targets under the Kyoto Protocol's first commitment period (i.e. excluding
Cyprus and Malta) reduced their emissions by 38.7 % vis-à-vis the Kyoto
base years. Emissions are expected to have decreased further in 2012. According
to the 2011 inventory data, these eleven Member States are likely to meet their
Kyoto target for the first Commitment Period. Slovenia is the only Member State
out of the EU-11 that considered until recently using credits from projects
under the Kyoto mechanism to complement domestic reduction measures. Based on
the latest data, Slovenia could meet its Kyoto target without making use of
these mechanisms. The other EU-11 Member States have sold or plan to sell part
of their unused Assigned Amount Units (AAUs) (see section 3.2). 
Figure 6:
Relative gaps between GHG emissions in the non-ETS sectors for the first commitment
period and the respective 2008-2012 Kyoto targets (including LULUCF) with and
without the use of Kyoto mechanisms. Gaps are expressed in percentage of base
year emissions (including ETS and non-ETS). Negative and positive values
respectively indicate overdelivery or shortfall.
Source:
EEA
3.2.        Projected use of Kyoto mechanisms by Operators and Union's
governments
Under the EU
ETS, the second National Allocation Plans (NAPs) establishes a limit for each
Member State for the maximum use of project-based credits from Joint
Implementation (JI) and Clean Development Mechanism (CDM) by operators. In
total and on average, up to 278 million CERs or ERUs may be used per year by
ETS installations from all Member States between 2008 and 2012, which
corresponds to 13.4 % of the EU-wide cap for this period. Actually, operators
used 1058.7 million CERs or ERUs which was 10.8 % of all units surrendered
for compliance. The amount of credits surrendered
increased from 4 % of total verified emissions in 2008 to 26 % in
2012 due to the falling prices of international offsets. From 2013 onwards the rules for the use of JI and CDM credits have
been revised as set in the EU ETS Directive. 
Nine Member States of the EU-15 as well as Slovenia
have indicated to purchase and use international credits from Kyoto mechanisms
to reach their Kyoto targets. Together, these Member States estimated that they
would acquire up to 82 Mt CO2-eq. per year for compliance
under the first commitment period under the Kyoto Protocol. This would represent
1.9 and 4.9 percentage points towards the Kyoto targets for the EU-15 and for Slovenia,
respectively (see Table 12 in the SWD).
These 10 Member States together anticipated
to invest up to € 2.4 billion to acquire units through JI, CDM or AAU trading. Austria, the Netherlands, Spain, Ireland and Belgium allocated the
largest budgets for the five-year commitment period. In
Slovenia, the budget has been estimated at € 80 million. However, given the
impact of the continuing economic recession on GHG emissions, Member States might
not need as many international credits as initially estimated. 
As regards AAUs sold by Member States,
according to most recent data available, about 68.2 Mt CO2-eq.
have been transferred so far, while some contracted amounts may not be
delivered yet. Bulgaria, the Czech Republic, Estonia, Hungary, Latvia, Lithuania
and Slovakia reported that they intend to further sell AAUs. One Member State
(UK) has legislated that it would cancel any surplus AAUs between the Kyoto
target and the UK unilateral ‘carbon budget’ after the first commitment period.

3.3.        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. The information provided so far indicates that
total net sequestration during the commitment period from afforestation and
reforestation activities under Art. 3.3 of the Kyoto Protocol will be 17.1 MtCO2
per year for the EU-15. In addition, the use of activities under Article 3.4 is
projected to contribute about 46.7 MtCO2 per year of the commitment
period in the EU-15. Taking in addition into account contributions from EU-13,
the accounting of these activities will amount to 23.3 and 60.6 MtCO2
per year (for details see Table 13 in the accompanying Staff Working
Document).
Together, activities
under Article 3.3 and 3.4 in the EU-15 Member States are projected to reduce
emissions by 63.9 Mt CO2 per year of the commitment period. This is
equivalent to about 1.5 percentage point of the EU-15 reduction commitment during
the first commitment period compared to base year emissions. 
4.           Progress
toward the 2020 target
4.1.        Union's
GHG emission reduction target by 2020 
The Climate and
Energy Package set a 20% GHG emission reduction target for EU-28 by 2020
compared to 1990, which is equivalent to -14% compared to 2005. This is also
the basis for the EU's international obligation under the 2nd
commitment period under the Kyoto Protocol from 2013-2020. 
This effort will be
divided between the EU ETS and non-ETS sectors as follows: 
(a)              
21% reduction in EU ETS sector emissions by 2020
compared to 2005 and
(b)              
Under the Effort Sharing Decision (‘ESD’), a reduction
of around 10% by 2020 compared to 2005 for the sectors that are not covered by
the EU ETS. The ESD mainly covers emissions from transportation, buildings,
small businesses and services, agriculture and waste. 
While the ETS provides an EU-wide cap, the
ESD relies mostly on Member States defining and implementing additional
national policies and measures to limit their emissions in the ESD sectors. The
ESD sets annual emission allocations from 2013 to 2020.
4.2.        Projected
distance to targets
According to Member
States’ projections submitted in 2013, when international aviation is included,
EU emissions are projected to be 21% lower in 2020 than
in 1990 and 22 % lower when international aviation is excluded. The EU-28
is currently on track to meet its EU 2020 target. However, 13 Member States will need additional efforts to meet their 2020
targets for the non-ETS sectors while 15 Members States are already projected to
reach these commitments with existing policies and measures. 
Figure 7 shows the gap per Member State between
non-ETS GHG emissions projections by 2020 based on existing measures and the
2020 targets as a percentage of 2005 emissions. This analysis
does not yet take into account the use of flexibilities provided for in the
ESD, such as the use of international project credits or transfers of surplus
emissions allocations among Member States. The graph also shows the gaps
between the 2012 emissions and the 2013 national targets under the ESD. 
As part of the European Semester, the
Commission carries out specific analysis on the situation of individual Member
States as regards progress towards their 2020 targets based on projected
emissions with existing measures. The most recent analysis, reflected in the Commission Staff Working Documents (SWD) published as part of the
European Semester in early June 2013[9],
lead to the following main conclusions which are confirmed by the latest
projections provided by Member States after completion of quality check and
gap-filling by the European Environmental Agency[10]: 
·                        
GHG emissions in Luxemburg are projected to exceed the national target by a wide
margin (gap of 23 percentage points). Emissions in 2012 are also above the 2013 targets under the ESD. Significant GHG
emission reductions could be achieved by increasing taxation on energy products
for transport, as underlined in the Country Specific Recommendation (CSR). 
·                        
Ireland’s GHG emissions are also expected to exceed
the target by a wide margin (gap of 18 percentage points) due to a large
increase of emissions in transport and in agriculture. Ireland however proposed
in 2013 a range of initiatives to reduce emissions under the Low-Carbon
Development Bill. 
·                        
Emissions in Belgium are also projected
to fall short of the national target by 11 percentage points. In this regards,
the CSR for Belgium stressed the need for a clear division of tasks between
authorities to ensure progress reaching the targets, in particular in the field
of transport and buildings. Measures should also be taken to shift taxes from
labour to less growth-distortive tax bases, notably environmental taxation. 
·                        
Furthermore, projections show also that five
other Member States (Lithuania, Spain, Austria, Finland
and Italy) are expected to miss their target by a gap
of more than 3%. For these Member States, current measures are expected
not to be sufficient for achieving national targets.
·                        
According to their national projections, Poland and
Estonia would overachieve their target by a wide margin. However, Polish
projections were carried out in 2010 and 2011. Recent EU baseline projections
based on PRIMES and GAINS models indicate that Poland could face difficulties
in delivering on its commitment. Estonia’s emissions are higher than expected. According
to approximated data, Estonia’s emission will exceed in 2012 its 2013 ESD
target and could face also difficulties in meeting its commitment. 
In the context of the 2013 European
Semester, the Council adopted several country-specific recommendations relevant to GHG emissions reduction. The Council recommended that Belgium,
the Czech Republic, France Hungary, Italy, Latvia, Lithuania, Romania and Spain
shift the tax burden away from labour to taxes less detrimental to growth,
including environmental taxes. It recommended Estonia, Lithuania and Luxembourg
to enact appropriate fiscal measures to improve the energy efficiency of the
transport sector. The Council also recommended Bulgaria, the Czech Republic, Estonia,
Latvia, Lithuania, Malta, Poland, Romania and Slovakia to pursue efforts to
improve energy efficiency. The UK was recommened to stimulate investments in
new energy capacity, including in renewable energy. 
Figure 7: Projected
gap to 2020 targets for non-ETS sectors and gap between the 2012 emissions and the non-ETS 2013 target. Negative and positive values respectively indicate overdelivery and
shortfall in percentage of 2005 emissions.
Source: EEA, European Commission based on projections by the
Member States. 
5.           State
of implementation of the Union's climate change policy
5.1.        Reducing
emissions
Work on implementation measures of the 2009
climate and energy package has led to the successful start of phase 3
(2013-2020) under the EU ETS and the finalisation of the implementing measures
under the ESD. 
5.1.1.     EU ETS
The EU ETS covers more than 12 000
power plants and manufacturing installations in the 28 EU member states,
Iceland, Norway and Liechtenstein and also, from 2012, emissions from airlines
flying between airports in these countries and to closely connected areas. The
EU-wide average annual cap for 2008-2012 amounted to 2081 million allowances
per year. 
Verified emissions of greenhouse gases from
stationary installations have continued to fall, dropping to 1 867 million
tonnes of CO2-equivalent in 2012, about 2% below the 2011 level for
installations and 10% below the cap. Verified emissions reported by airlines
amount to almost 84 million tonnes. 
The level of compliance by the installations
remains very high. Only less than 1% of the installations participating in the
EU ETS did not surrender allowances covering all their 2012 emissions by the
deadline of 30 April 2013.
As of 2012, aviation emissions are subject
to a cap in the EU ETS. Aircraft operators responsible
for over 98 % of the 2012 aviation emissions covered by the EU ETS have
successfully taken the necessary steps by 30 April 2013 to comply with the EU
ETS legislation. In accordance with the provisions of the "stop the
clock" Decision adopted in April 2012, aircraft operators may limit their
responsibility for 2012 to flights within Europe only, in which case they may
also have taken a further step by 27 May to return free allocations for flights
outside Europe. 
As provided for by the revised EU ETS
Directive, all EU ETS operations are centralised into a single registry
operated by the Commission. In May 2013, the regulatory framework applicable to
the registry was revised to finalise the functionalities needed for phase 3.
The new Regulation also provides for the accounting in the registry of
transactions under the Effort Sharing Decision. 
The Commission is currently finalising the
assessment of the National Implementation Measures (NIMs) to Commission
Decision 2011/278/EU. The Commission is assessing whether the preliminary free
allocation of allowances to industrial installations in each Member State has
been done in compliance with the harmonised allocation rules for phase 3 of EU
ETS. 
A review of the Auctioning Regulation is on-going
as regards the auction time profile. In this context the proposal for a
Decision to clarify the provisions of the EU ETS Directive regarding the
Commission’s powers to adapt the timing of auctions of emission allowances in
exceptional circumstances is currently undergoing co-decision. Furthermore, the
Commission has also adopted a report on the state of the European carbon
market, which sets out a range of possible structural measures that can be
taken to tackle the imbalances.
The European Commission authorised, under
strict application of the Directive, requests from 8 Member States to grant
transitional free allocations of allowances to their power sectors beyond 2012.

In June the Commission has prepared a draft
Regulation specifying the maximum limits up to which operators under the EU ETS
may use eligible credits from the Kyoto Protocol’s project based mechanisms
(i.e. CDM and JI) for compliance with emission limits from 2013 to 2020.
Work on facilitating implementation of the
two new Regulations on monitoring and reporting of GHG emissions by operators and
aircraft operators covered by the EU ETS and on the verification of emission
reports and the accreditation and supervision of verifiers is ongoing and aims
for improved harmonisation of the applied rules. A complete suite of guidance
documents, templates and FAQs is being developed to support Member States'
implementation of the third ETS period.
In a major step towards the first full
inter-continental linking of emission trading systems, the Commission and
Australia agreed in 2012 on a pathway for linking the EU ETS and the Australian
emissions trading scheme. In May the Commission received a mandate from the
Council to negotiate, on behalf of the EU, a treaty by mid-2015 for the full
link, which is supposed to happen no later than 1 July 2018. Based on a mandate
from the Council, the Commission is also negotiating with Switzerland on
linking the EU ETS with the Swiss ETS.
5.1.2.     Other policies and measures

Member States' annual emission allocations in
CO2-equivalents under the Effort Sharing Decision for each year in
2013 to 2020 were determined in 2012 and adopted in March 2013. 
A new EU Monitoring Mechanism Regulation
was adopted, revising and replacing the previous Monitoring Mechanism Decision,
and a new Decision was adopted for accounting of land use, land-use change and
forestry.
The Commission adopted a Communication
setting out a strategy for progressively including GHG from maritime transport
in the EU's policy for reducing its overall GHG emissions. As a first step in
implementing this strategy, the Commission proposed a Regulation which would
establish an EU-wide system for the monitoring, reporting and verification of
CO2 emissions from large ships starting in 2018. The draft Regulation
is under consideration of the Parliament and the Council.
The Energy Efficiency Directive was adopted
in October 2012. This directive will contribute to achieving Europe's 20% energy efficiency target for 2020. 
On 24 January 2013, the European Commission
adopted the "Clean Power for Transport Package", aimed at gradually
reducing oil dependence through the use of alternative fuels in transport. The
package includes the proposal for a Directive establishing binding targets for
alternative fuel distribution infrastructures such as electricity, hydrogen and
fuel cells. 
The NER 300 funding programme is a mechanism
for the financing of commercial demonstration CCS and RES projects, covering
300 million allowances from the new entrants reserve of the EU ETS. Under this
programme, the Commission adopted funding awards in December 2012 for a total
value of € 1.2 billion to 23 renewable energy projects. This amount is
estimated to have leveraged additional funding of over € 2 billion from private
sources. A second call for CCS and RES project proposals was launched in April
2013. Awards in mid-2014 will be funded from the sale of the remaining 100
million allowances and unused funds from the first call.
Implementation of Regulation (EC) 443/2009
related to CO2 from cars and Regulation (EU) 510/2011 related to CO2
from light commercial vehicles is almost completed. The Commission approved
already two eco-innovations to help reduce CO2 emissions from
passenger cars. 
It also made proposals on modalities for
reaching the 2020 target to reduce CO2 emissions from new passenger
cars and from new light commercial vehicles (vans) which are currently under
consideration in the Council and the Parliament. 
In November 2012 the Commission proposed to
the Council and the Parliament a new Regulation on fluorinated greenhouse gases
in order to reduce emissions from this sector further. 
In order to mitigate against the indirect
land use change greenhouse gas emissions impacts from biofuel production, the
Commission also proposed a number of amendments to the Renewable Energy and
Fuel Quality Directives. 
On the mainstreaming of climate action into
EU policies, a political agreement on the next Multiannual Financial Framework
(MFF) 2014-2020 has been reached. All Institutions have agreed that at least
20% of the overall budget should be climate related.
The Commission adopted in March a
consultative Communication that launched a public debate on how best to design
a new international agreement for 2015, which will lay down the international
regime for fighting climate change post 2020.
In March 2013 the
Commission took the first step towards developing a 2030 framework for EU climate change and energy
policies adopting the Green Paper "A 2030 framework for climate and energy
policies". This document launched a public debate on an EU energy and
climate change strategy for 2030. 
A list of legal acts recently adopted is
available in section 3 of the SWD. 
5.2.        Adaptation
to climate change
On 16 April 2013, the Commission adopted
the EU Strategy on Adaptation to Climate Change aiming at contributing
to a more climate resilient Europe. The strategy will enhance the preparedness
and capacity to respond to the impacts of climate change at local, regional,
national and EU levels, and it will develop a coherent approach and improved
coordination. It focuses on three objectives: 
·                        
Promoting action by Member States: The
Commission will encourage all Member States to adopt comprehensive adaptation
strategies (currently 15 have strategies) and will provide funding to help them
implementing their adaptation policies. It will also support adaptation in
cities by launching a voluntary commitment based on the Covenant of Mayors
initiative. 
·                        
'Climate-proofing' action at EU level by further
promoting adaptation in key vulnerable sectors such as agriculture, fisheries
and cohesion policy, ensuring that Europe's infrastructure is made more
resilient, and promoting the use of insurance against natural and man-made
disasters. 
·                        
Better informed decision-making by addressing
gaps in knowledge about adaptation, also in link with Horizon 2020, and further
developing the European climate adaptation platform (Climate-ADAPT) as the
'one-stop shop' for adaptation information in Europe. 
EU-Cities Adapt, an EU initiative providing capacity building and assistance for
cities in developing and implementing adaptation strategies, was successfully
completed in 2013.
5.3.        Climate
Finance 
The EU has been the largest contributor to
both mitigation-related and adaptation-related ODA in 2010 and 2011, with a
share of around 50% according to OECD DAC reporting. As part of the fast-start
finance commitment by developed countries of USD$30 billion, the EU and its
Member States committed to providing EUR 7.2 billion over the period 2010-2012.
The EU and its Member States fulfilled their commitment by allocating EUR 7.34
billion to fast-start finance over that period, as reported in the submission
to the UNFCCC by the EU and its Member States in May 2013. The funds committed
in 2012 are € 2.67 billion. More information can be found in the report
European Union fast start funding for developing countries[11].
Furthermore, pursuant to Article 16 of the
MMR, as of 2013 Member States shall report annually by 30 September on
financial and technology support provided to developing countries. 
5.4.        Climate
research & innovation
Climate research is one of the main
research themes of the EU's Seventh Framework Programme (FP7, 2007-2013) and
will be central to Horizon 2020[12], the
new EU programme for research and innovation 2014-2020.
Climate change research in FP7 aims to
support projects that analyse the pressures on the environment (oceans,
atmosphere, and ecosystems) and improves our understanding of the complex
climate system, also through Earth System modelling. Another key research area
is assessing impacts, vulnerabilities and solutions for adapting to climate
change, developing strategies for disaster risk reduction and to stimulate a
transition to a low-carbon society. A preliminary estimation indicates that in
FP7, from 2007 to 2013, about 900 Million euro have been spent to support
climate-related research. 
As for the
future programme, it is worth mentioning that 35% of
the Horizon 2020 budget of around 70 billion euro is expected to be invested in
climate-related research and innovation actions.
6.           Situation in the Union's candidate
and potential candidate countries 
Iceland's GHG emissions between 1990 and 2011 increased
by 26% and in 2011 were 4.4% lower than in 2010. Taking into account decision 14/CP.7,
and according to the GHG projections included in the 5th National
Communication, Iceland is on track to meet its Kyoto target. 
Turkey’s GHG emissions (excluding LULUCF) increased by 124 %
between 1990 and 2010 and 5% between 2010 and 2011. While Turkey is an Annex I
Party, it has no GHG target under the 1st or the 2nd commitment
period of the Kyoto Protocol. 
An up-to-date inventory of GHG emissions in
the former Yugoslav Republic of Macedonia (FYROM) is not available.
FYROM is a non-Annex I Party. Between 1990 and 2005 total GHG emissions
decreased by around 19%. 
Similarly, Montenegro which is also a non-Annex
I Party to the Convention saw its total GHG emissions (excluding LULUCF)
increased by around 4.9 % between 1990 and 2003. 
No recent information is available for Serbia.

[1]               100-day period after publication of the final UNFCCC
GHG inventory review report for 2008-2012.
[2]               See
Technical Notes in Annex
[3]               Decision No. 406/2009/EC of the European Parliament
and of the Council of 23 April 2009 on the effort of Member States to reduce
their greenhouse gas emissions to meet the Community's greenhouse gas emission
reduction commitments up to 2009.
[4]               http://ec.europa.eu/europe2020/making-it-happen/index_en.htm
[5]               Further details on the methodology is available on
the European Environmental Agency Trend and Projection Report. 
[6]               Average actual emissions 2008 - 2012 (proxy data) are
used for Cyprus and Malta since these two countries do not have obligations
under the 1st commitment period. 
[7]               These targets are often referred to as Quantified
Emission Limitation or Reduction Commitments (QELRC). Further details on the
methodology applied for their calculation are available in the Commission’s
Staff Working Document of 13 February 2012 ‘Preparing the EU's Quantified
Emission Limitation or Reduction Objective (QELRO) based on the EU Climate and
Energy Package‘:
http://ec.europa.eu/clima/policies/international/negotiations/docs/swd_13022012_en.pdf   
[8]               Based on approximate data for 2012.
[9]               http://ec.europa.eu/europe2020/making-it-happen/country-specific-recommendations/index_en.htm
[10]             Member States submissions were quality-checked,
gap-filled and adjusted where necessary. An estimation of the share of non-ETS
emissios had to be made for several Several Member States. For the gap filling
and ETS/non-ETS split estimation, data from the 2012-13 EU baseline with
adopted measures projection based on the PRIMES and GAINS models have been
used. The latter projections also indicate the sensitivity of projection
results to different methodologies, assumptions and specific parameters behind
the trends. 
[11]             http://ec.europa.eu/clima/policies/finance/international/faststart/docs/fast_start_2012_en.pdf
[12]             http://ec.europa.eu/research/horizon2020/index_en.cfm