Allocation & auctioning

Harmonised allocation rules

The second commitment period (or third phase) started on 1 January 2013 and covers emissions in the period 2013-2020. The free allocations to the installations and aircraft operators within this period have been calculated based upon harmonised allocation rules:

  • Allocation is no longer done on a national level but in a harmonised way across Europe
  • Allocation is done based upon historical data on production and emissions
  • Less allowances are allocated for free, more allowances are auctioned
  • The amount of allowances allocated for free decreases towards the end of the period
  • No free allocation is given to installations for electricity generation
  • Changes within operators and aircraft operators may lead to changes of their free allocations
  • Carbon leakage measures have been implemented to prevent delocalisation of production following possible additional ETS-costs compared to non-EU countires.

Free allocation

Each year in February most installations and aircraft operators participating in the EU ETS receive a free allocation of allowances. This free allocation is based upon the National Allocation Table and has been determined for the whole commitment period (2013-2020).

New entrants in the EU ETS might be added to the allocation table later and changes to the table might be made (for example due to significant capacity increase).

You can download below the allocation tables of the previous commitment period (CP1, 2008-2012):

Auctioning

During the current commitment period (CP2, 2013-2020) approximately half of the general emission allowances (EUAs) will be sold through regular auctions, in accordance with Commission Regulation (EU) No. 1031/2010 (the "Auctioning Regulation").

The European Commission has designated the German auctioning platform EEX as common European auctioning platform for the European Member States. As most other Member States, Belgium takes part in this platform (since the end of 2012). Germany, Poland and the United Kingdom are not participating in the common European trading platform, but they are organising their auctionings themselves. Germany and Poland are using their own instances of the EEX auctioning platform, while the UK uses the ICE auctioning platform.

Any operator and aircraft operator participating in the EU ETS can participate in the auctionings. Other entities (like for example investment firms or credit institutions and in principle even individuals) may participate as well. All entities applying for admission to bid need however to fulfill the requirements of the Auctioning Regulation as well as any additional requirement set by the auctioning platform (EEX/ICE) itself. In practice, only about 20 entities participate in the auctions EU-wide.

Auctioning platforms publish an auctioning calender on their website. This calender gives an overview of the auctioning dates as well as of the number of allowances auctioned each date (here for example the EEX calendar).

The following report provides an overview of the Belgian auctioning revenues so far : BE auctioning revenues (period 2013 - August 2018).

Carbon leakage

Carbon leakage describes the situation that may occur if, for reasons of costs related to climate policies like the EU ETS, operators transfer production to other countries (outside the EU). The risk of carbon leakage may be higher in certain energy-intensive industries.

Carbon leakage is an unwanted effect as, in case of a transfer of production, CO2 emissions might no longer be regulated. Moreover there is a negative effect on the European economy as well. Hence, based on the 'carbon leakage status' of an installation, more or less allowances might be allocated for free.

More information on carbon leakage can be found at the website of the European Commission: http://ec.europa.eu/clima/policies/ets/cap/leakage/index_en.htm.

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