The European Union Emission Trading System is one of the most advanced trading systems of greenhouse gas emissions, being a major pillar of EU climate policy. Under the EU ETS, the governments of EU Member States agree on national emission caps which have to be approved by the EU commission, allocate allowances to their industrial operators, track and validate the actual emissions against the relevant assigned amount, and require the allowances to be retired after the end of each year. The operators within the ETS may reassign or trade their allowances, either over-the-counter through specialized brokers, or on an exchange.
The highest price from the emergence of the European market in 2005 was over 30 euro/ton, while the lower was of half euro per ton. The value of trades with certificates of carbon dioxide emissions has been in 2008, worldwide, of 60 billion dollars, rising with 80% in comparison to the previous year.
The allocation of EGES certificates is the European Union`s main instrument to fight against the Global Warming. According to the Kyoto Protocol, a certificate corresponds to one tone of carbon dioxide, and through the allocation are determined the limits of the carbon dioxide quantities which the industries are allowed to emit.
The companies sell and buy emissions certificates depending on how they fulfill their pollution targets. The allocation of certificates is made, in a first phase, on the sectors of economy, and then on installations that emit carbon dioxide. An operator that uses an installation which is in the allocation scheme may be in one of the following situations:
- it issues a quantity of carbon dioxide bellow the allocated limit and he can freely sell the surplus of certificates on the market;
- it issues a quantity of carbon dioxide beyond the allocated limit and it is obliged to buy certificates from the market or to restrict its activity who is generating emissions;
- it emits carbon dioxide in the allocated limit, so it is not required either to buy or sell certificates.
The European ceiling for the period between 2008 and 2012 is of 2.08 billion tons of emissions annually.
For Romania, the national ceiling of allocation for the period 2008 – 2012 is of 379,721,760 certificates, respectively 75,944,352 certificates annually. By sectors, the situation is the following:
Eight companies, the biggest polluters from Romania, will receive more than half of the national certificates of emissions of greenhouse gases, according to the trading scheme published by the Ministry of Environment. According to the number of allocated certificates for the period 2008 – 2012, the biggest polluters are:
- Mittal Steel Galati – about 71 million allocated certificates,
- SC Complexul Energetic Turceni – 34 millions,
- SC Complexul Energetic Rovinari – 28 million,
- SC Electrocentrale Deva – 20 million,
- Complexul Energetic Craiova – Isalnita – 17 million,
- RAAN Sucursala Romag Termo – 14 million,
- Lafarge Ciment (Romania) Medgidia – 12,3 million,
- Petrom SA Arpechim Pitesti – 9,6 million.
Each operator of polluting equipments is free to chose the ways through which he will sell or buy the emissions certificates, and the certificates record is held by a standardized system of national registries in each EU member country. For Romania that is the National Register for Emissions
Large polluting companies have internal departments for trading carbon credits, and those who do not have such a department are working with the banks. There are also profile companies, respective the foreign brokers who are members at one of the mentioned stock exchanges, who are intermediaries in the trading of certificates allocated to the Romanian companies.
In the absence of a secure and accessible organized market of carbon certificates, the installations covered by the national allocation plan may be penalized if they exceed the annual allocated quote, penalties who can reach the amount of 100 euro/carbon dioxide tone. As well, the installations that have a surplus of certificates cannot capitalize them efficiently.
Currently Carbon Credits fall under the Tax Code. In this act the carbon certificates are classified as services, which are subject to the rules of VAT. Thus is as result of the suspension of R.N.S.C.`s notice, through which the carbon certificates were classified as financial instruments and therefore would not be subject to VAT.