1.3 Determination of the total quantity of allowances to be allocated
1.3 What is the total quantity of allowances to be allocated (for free and by auctioning), and what is the proportion of overall emissions that these allowances represent in comparison with emissions from sources not covered by the emissions trading Directive? Does this proportion deviate from the current proportion of emissions from covered installations? If so, please give reasons for this deviation with reference to one or more criteria in Annex III to the Directive and/or to one or more other objective and transparent criteria.
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The total quantity of allowances to be allocated in 2007 is 49,651 million tonnes СО2. Total national greenhouse gas emissions in 2007 are projected to be 80,763 million tonnes СО2 eqv with existing measures and policies. The allocation of allowances represents 61.5% of the overall emissions for 2007. It is expected that allowances for delayed installations, which succeed to register before the submission of BNAP to the EU, and allowances for installations, which will register later and for new entrants will be added to that quantity. Thus, the percentage could increase to 64-65%. In 2003, the emissions from installations covered by the Directive were 61% of overall national emissions. The increase in emissions will be a result of the restoration of the construction materials industry that started in 2003 and is constantly increasing by over 10% per year. As a result, a trend has been observed toward increase in emissions and carbon intensity of the GDP. In 2005, this trend continued because of the implementation of a range of infrastructure projects postponed for more than 15 years during the transition period. A two-figure growth of the production volume of cement, lime and other construction materials took place. Unsurprisingly, this growth has an impact on the volume of GHG emissions covered by the Scheme. In addition, at the end of 2006, under an agreement between the Bulgarian Government and the European Union, two nuclear power generation units with 880 MW total capacity and producing over 12% of the production of electric energy in the country, will be closed. The energy compensation will be on the account of combustion of lignite coals. An increase of GHG emissions is expected of 5 million tonnes (6%). In reality, the increase in emissions will be smaller, because in 2007 a rehabilitation of some capacities in the thermal power stations will be carried out and therefore, their specific emissions will be reduced. Also, after the closure of nuclear power capacities, the export of electric energy will considerably decrease.
The total quantity of allowances to be allocated to participants in the Scheme is calculated as the volumes of emissions at national and sector level determined through macroeconomic forecast and corrected with the calculative reserves, namely: at a national level – a new entrants, and a delayed installations reserve; in the “Energy activities” sector – a reserve for new co-generation, a reserve for compulsory measures, a reserve for standardisation of degrees/day of heating companies to compensate reduced consumption due to the higher than average temperature during the base years, and a reserve for cancellation of allowances for early credits and avoidance of indirect double counting.
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