For allocation of allowances for greenhouse gas emissions trading for participation of bulgaria in the european greenhouse gas emission

– 1.9 Rendering an account of the emissions reduction potential and the EU legislation. Allocation of allowances through auctioning

1.7. Please explain in Section 4.1. below how the potential, incl. the technological one, of the emissions reduction activities has been taken into account during the process of determination of the total amount of allowances for allocation?

The total quantity of allowances has been determined according to Commission Decision of 26 October 2007 for Bulgarian NAP for 2008-2012 and Corrigendum to the Commission Decision of 26 October 2007, and which assumes a huge, non-existing potential for emissions decrease under the conditions of high economic growth.

1.8. Please particularize in Section 5.3 below the EU legislation and policies taken into account during the process of determination of the total amount of allowances for allocation?

The total amount of allowances complies with Commission Decision of 26th October 2007 as amended by Commission Decision of 04th December 2008 on the draft BNAP for the period 2008-2012.

1.9. If a Member State intends to allocate allowances by auction, please state the proportion of the total quantity to be sold and the manner in which the auction will be held?

Bulgaria does not intend to use the option of auctioning of part of the allowances in the initial allocation process. All allowances under the BNAP for 2008 – 2012 will be allocated initially free of charge.

During 2012 and the beginning of 2013 the remainder of the reserve for new entrants and the reserve for avoiding double counting of greenhouse gas emission reductions for JI projects with letter of approval (see Annex 2, Tab. P2.1), but no more than 10 % of total quantity of the remainder, will be sold on the allowances market with the cooperation of financial-broker or will be auctioned. The auctions will be held in accordance with the EC requirements. The auction rules will be formulated and sent to EC for concert no later than 31.10.2011.

The total quantity of allowances in the reserve for avoiding double counting from JI projects with letter of endorsement (see Annex 2, Tab. P2.2), thaand that has not been transferd in ERU’s until the end of the period, will be canceled.