The ETS reform proposal falls short of addressing stakeholders’ concerns and effectively protecting EU refineries against carbon leakage

FuelsEurope welcomes the focus of the Commission on carbon leakage protection and the recognition of the key role of Energy Intensive Industries in the European economy. However, ETS proposals fail to provide sufficient structural improvements to current carbon leakage provisions. As a result of insufficient free allocation since the beginning of Phase III the EU Refining industry is already partly exposed to the risk of carbon leakage. The sector therefore urgently needs fair, effective and simple solutions to the issue of carbon leakage after 2020. Unfortunately, current flaws in the system which remain unaddressed will lead following FuelsEurope’s preliminary assessment to an additional cost of approximately 15 Billion € over Phase IV, including indirect costs.