MEP concerned about risk to cement industry
08 July 2008
As the economic downturn continues Traditional Unionist MEP, Jim Allister, has held a series of meetings with key economic sectors over recent weeks, particularly with a view to establishing how the EU can help, if at all. Identifying the concrete and cement industry as key to economic growth and activity, Mr Allister has been in discussion with EU Commission officials over Brussels’ plans to restructure its carbon tariff pricing policy, which the MEP believes has the disastrous potential to drive cement production out of the EU.
Mr Allister explained:-
“The Commission proposes to revise its CO2 Emissions Trading Scheme (ETS). Industries currently covered by the ETS receive for free most of the ETS allowances they need. For the third trading period (2013-2020) the Commission proposes that a reduced share of these allowances be distributed for free. This will have an economic impact on industries covered by the ETS. Therefore the Commission has proposed two measures to facilitate this transition and to address the risk that production moves abroad, to no environmental benefit, and leading to loss of jobs (so called carbon leakage).
The first measure is that all industrial sectors would get up to 80% of their share of 2005/2007 emissions for free in 2013, declining to 0% only in 2020. Secondly, the proposal foresees a possibility for sectors deemed to be exposed to a significant risk of carbon leakage to get up to 100% of their 2005/2007 share as free allowances, at least until 2020. Alternatively some form of border measure could be considered to address the risk of carbon leakage.
The cement industry is particularly vulnerable to carbon leakage, with large scale production facilities already in operation in the Far East and Africa. Thus it is imperative that our EU cement industry gets maximum protection. Hence, recently I have been actively lobbying the Commission on this issue.
The Commission has proposed that it will be decided at the latest by June 2010 which sectors are deemed to be exposed to a significant risk of carbon leakage. Thus, it is important in the meantime that maximum pressure is exerted on Brussels to demonstrate that the cement sector is particularly exposed to carbon leakage. To date the Commission has acknowledged in communications with me that the cement and concrete are indeed energy intensive industries, but they need to go further and indicate now that come 2013 our EU cement industry will be protected and not driven out by self-inflicted and foolish reductions in ETS allowances.
The significance of this issue goes far beyond the cement industry itself, not only is there the risk of it being driven abroad but the consequence for the construction industry would be higher costs which would impact adversely in the economy and accentuate the slow-down."
