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

ААU –Assigned Amount Units

First stage – Stage of application of the Directive in year 2007

GHG EP – Greenhouse Gas Emissions Permit

RIEW – Regional Inspectorate of Environment and Water

UNFCCC – United Nations Framework Convention on climate change

CER – Certified Emission Reduction Units

JI – Joint implementation

KP – Kyoto Protocol

TPP – Thermal Power Plant

Co-gen. – Cogeneration

CHP - Cogeneration Heat Power Plant

DHC - District Heating Company

DHP - District Heating Plant

EF – Emission Factor
Introduction
The Community-wide Emissions Trading Scheme is the main EU instrument for the fulfilment of the Union’s commitments under the Kyoto Protocol. Directive 2003/87/EC established an European Scheme for Greenhouse Gas Emission Allowance Trading within the Community. Since 1 January 2005, Member State installations covered by the Directive have started reducing their carbon dioxide (СО₂) emissions to levels set, respectively, for the 2005–2007 and for the 2008–2012 period.
The Scheme’s main elements include:

1. Allocation of emission allowances by means of National Allocation Plan;

2. Greenhouse gas emissions permits issued to each installation;

3. Monitoring, verification and reporting of emissions;

4. Registries to ensure the accounting of transactions concerning emissions allowances;

5. Compliance control and penalties.

Pursuant to the Directive, from 1 January 2007, the Bulgarian installations covered by the Directive’s Annex I are not allowed to emit carbon dioxide unless they hold an GHG emissions permit. Installations holding such permits have to monitor their carbon dioxide emissions and report them annually. They also have to surrender a number of allowances equal to their total emissions during the preceding calendar year.
The first stage of the EU Emission Trading Scheme (EU ETS) for Bulgaria will begin after allocation’s approval from the EC. By that date, the operators under Annex I of the Directive and Article 131c of the Protection of the Environment Act must have procured greenhouse gas emissions permits. The monitoring and reporting requirements, which are in accordance with the instructions of the EC and are part of the permits, must be implemented by the operators.
The development of the Bulgarian National Allocation Plan (BNAP) for the period 2008-2012 is coordinated by an Interministerial Working Group (IWG) of the Ministry of the Environment and Water, the Ministry of the Economy and Energy, the Ministry of Regional Development and Public Works, the Ministry of Finance, the National Statistical Institute, and non governmental organisations, including: the Bulgarian Industrial Association and the associations of the industries included in the Scheme, i.e.: the Bulgarian Association of the Cement Industry; the Bulgarian Chamber of the Energy Industry; the Chamber of the Paper and Pulp Industry; Glass Industry; the Chamber of the Ferrous and the Non-Ferrous Industry; the Bulgarian Chamber of the Chemical Industry; the Bulgarian Union of Ceramic Workers (Order RD-186/06.04.2005), the Confederation of the Employers and Industrialists in Bulgaria (CEIBG). Technical assistance for the Plan is provided by Bulgarian and Dutch consultants with funding from the PSO Programme of the Government of the Netherlands.
In the development of the project of BNAP 2008-2012, which was submitted for approval at the EC are used:

• 
  Relevant EU Directives, Decisions, guidelines and commentaries;
  
• 
  Act constituting an Amendment to the Protection of the Environment Act implementing the Community Scheme;
  
• 
  Member State NAPs approved or rejected;
  
• 
  Input from seminars and workshops with industries, NGOs, and Government Ministries and Agencies;
  
• 
  EC Peer Review of EU ETS implementation in Bulgaria;
  
• 
  Experience of Member States whose NAPs were approved by the Commission, including: the Netherlands, the UK, Ireland, the Czech Republic, and Poland.
  

In Bulgaria the presentation to the Commission of BNAP for the period 2008-2012 was made in March 2007, and the EC Decision was announced in October 2007, which imposed a significant reduction with 37.4% of the quantity of allocated allowances for Bulgaria. А change of the methodology was needed because of the late release of the EC Decision.

This document is the IWG's proposal, approved by the Government, for the allocation of allowances for the period 2008-2012 based on the EC Decision from 26 October 2007.