Renewables or CCS: Commission paper opens debate for who should be eligible for funding from EU’S ETS
Monday, 15 June 2009 16:28 | 
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The European Commission has released an informal paper saying that the allocation of funding raised by the EU’s ETS (emission trading scheme) will not be predetermined, noting only that this money should be divided between renewable energies and CCS (carbon capture and storage).
The paper was being discussed at a working group of the climate change Council of Ministers last Wednesday, with around 300 million carbon allowances up for grabs in the scheme’s new entrants reserve. If the Commission proposal is approved, three-quarters of these allowances will be set-aside for CCS, with the rest for renewables.
In order to be eligible for the funding, projects will need to meet several different criteria, including financial soundness, level of innovation, replicability, commitment to knowledge-sharing and value-for-money. With these standards in mind, the paper has already published a list of eligible technologies, click here if you want to see a copy of the resolution including this list.
A bidding-war between Europe’s green industry who are supported by environmentalists, and large existing coal manufacturers who are strongly in favour of CCS, is now beginning to take shape. On the one hand those in favour of investing in CCS technology argue that the money is needed for funding 12-15 demonstration projects needed to kick-start the industry, with any knowledge gained during the pilot project phase being made public to all interested parties.
On the other hand, environmentalists are upset at what they perceive to be continued EU support for a polluting and continually dominant energy producing sector. They perceive it to be unfair that in addition to €1 billion the sector will receive under the recently agreed economic recovery package, it gets a majority of the funding that arises out of the new entrant’s reserve.
Green MEPs and GLOBE EU members Caroline Lucas and Claude Turmes have criticised the paper, observing that ‘The European Council's original support for using the New Entrants Reserve in this way was conditional on it being available to renewable energy as well as CCS, and there are new emerging renewable energy technologies which offer much greater potential for emissions reductions, as well as energy independence.’
As a next step there will be a stakeholder meeting for electricity firms, green groups and renewable energy representatives which will take place on 29 June.
The paper was being discussed at a working group of the climate change Council of Ministers last Wednesday, with around 300 million carbon allowances up for grabs in the scheme’s new entrants reserve. If the Commission proposal is approved, three-quarters of these allowances will be set-aside for CCS, with the rest for renewables.
In order to be eligible for the funding, projects will need to meet several different criteria, including financial soundness, level of innovation, replicability, commitment to knowledge-sharing and value-for-money. With these standards in mind, the paper has already published a list of eligible technologies, click here if you want to see a copy of the resolution including this list.
A bidding-war between Europe’s green industry who are supported by environmentalists, and large existing coal manufacturers who are strongly in favour of CCS, is now beginning to take shape. On the one hand those in favour of investing in CCS technology argue that the money is needed for funding 12-15 demonstration projects needed to kick-start the industry, with any knowledge gained during the pilot project phase being made public to all interested parties.
On the other hand, environmentalists are upset at what they perceive to be continued EU support for a polluting and continually dominant energy producing sector. They perceive it to be unfair that in addition to €1 billion the sector will receive under the recently agreed economic recovery package, it gets a majority of the funding that arises out of the new entrant’s reserve.
Green MEPs and GLOBE EU members Caroline Lucas and Claude Turmes have criticised the paper, observing that ‘The European Council's original support for using the New Entrants Reserve in this way was conditional on it being available to renewable energy as well as CCS, and there are new emerging renewable energy technologies which offer much greater potential for emissions reductions, as well as energy independence.’
As a next step there will be a stakeholder meeting for electricity firms, green groups and renewable energy representatives which will take place on 29 June.
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