Eurometaux: ETS compensation will not stop plant closures
23 Apr 2012
Brussels – EU plans to compensate for electricity price hikes due to its Emissions Trading Scheme (ETS) will lead to closures in industries such as aluminium, copper and zinc, the EU Non-Ferrous Metals Association (Eurometaux) has warned.
Under the EU proposals, industry would receive compensation for the production within its existing capacity and not only for historical production for most of the years 2005-11. This period includes the years of financial crisis.
If this proposal is upheld, the companies exposed will be compensated for a maximum of half of the CO2 costs they have paid, said Eurometaux.
Instead, the industry group wants aid to be based on the actual production of an installation. This, it believes, could be easily managed and represents the only way of avoiding under- or over-compensation.
“If the Guidelines do not allow for appropriate adaptations to possible production increases but maintain the rigid reference to historical production, the entire proposal would be undermined, particularly for companies that are operating at reduced production level and in most need of aid,” said Eurometaux.
The ‘fall-back’ benchmark levels for highly energy-efficient sectors without benchmark possibilities, such as copper, should not arbitrarily be set at 70%, but rather at levels comparable to sectors with benchmarks, the group added.
The EU Emissions Trading Directive has already resulted in a significant rise in European electricity prices, said Eurometaux. This, it believes, is a factor in a number of recently announced closures and curtailments in the UK, Netherlands, Italy and Spain,
”The EU Commission is proposing a scheme that will only serve to speed up the de-industrialisation of Europe, thereby increasing the EU’s dependency on imports of strategic metals. Once closed, these smelters will never come back to Europe” said Robert Jeekel, director energy & climate change policy at Eurometaux.
