Legal provisions of COM(2021)555 - Amendment of Regulation (EU) 2018/842 on binding annual greenhouse gas emission reductions by Member States from 2021 to 2030 contributing to climate action to meet commitments under the Paris Agreement

Please note

This page contains a limited version of this dossier in the EU Monitor.

dossier COM(2021)555 - Amendment of Regulation (EU) 2018/842 on binding annual greenhouse gas emission reductions by Member States from 2021 to ...
document COM(2021)555 EN
date April 19, 2023


Article 1

Amendments to Regulation (EU) 2018/842

Regulation (EU) 2018/842 is amended as follows:

(1)Article 1 is replaced by the following:

‘Article 1

Subject matter

This Regulation lays down obligations on Member States with respect to their minimum contributions for the period from 2021 to 2030 to fulfilling the Union’s target of reducing its greenhouse gas emissions by 40 % below 2005 levels in 2030 in the sectors covered by Article 2 of this Regulation. It contributes to the long-term target of climate neutrality in the Union at the latest by 2050, with the aim of achieving negative emissions thereafter. It thereby contributes to achieving the objectives of Regulation (EU) 2021/1119 of the European Parliament and of the Council (*1) (‘European Climate Law’) and the Paris Agreement. This Regulation also lays down rules on determining annual emission allocations and for the evaluation of Member States’ progress towards meeting their minimum contributions.

(*1)  Regulation (EU) 2021/1119 of the European Parliament and of the Council of 30 June 2021 establishing the framework for achieving climate neutrality and amending Regulations (EC) No 401/2009 and (EU) 2018/1999 (‘European Climate Law’) (OJ L 243, 9.7.2021, p. 1).’;"

(2)in Article 2, paragraph 1 is replaced by the following:

‘1.   This Regulation applies to the greenhouse gas emissions from IPCC source categories of energy, industrial processes and product use, agriculture and waste as determined pursuant to Regulation (EU) 2018/1999 of the European Parliament and the Council (*2), excluding greenhouse gas emissions from the activities listed in Annex I to Directive 2003/87/EC, other than the activity ‘maritime transport’ and activities only listed therein for the purposes of Articles 14 and 15 of that Directive.

(*2)  Regulation (EU) 2018/1999 of the European Parliament and of the Council of 11 December 2018 on the Governance of the Energy Union and Climate Action, amending Regulations (EC) No 663/2009 and (EC) No 715/2009 of the European Parliament and of the Council, Directives 94/22/EC, 98/70/EC, 2009/31/EC, 2009/73/EC, 2010/31/EU, 2012/27/EU and 2013/30/EU of the European Parliament and of the Council, Council Directives 2009/119/EC and (EU) 2015/652 and repealing Regulation (EU) No 525/2013 of the European Parliament and of the Council (OJ L 328, 21.12.2018, p. 1).’;"

(3)Article 4 is amended as follows:

(a)paragraphs 1 to 4 are replaced by the following:

‘1.   Each Member State shall, in 2030, limit its greenhouse gas emissions at least by the percentage set for that Member State in column 2 of Annex I in relation to its greenhouse gas emissions in 2005, determined pursuant to paragraph 3 of this Article.

2. Subject to the flexibilities provided for in Articles 5, 6 and 7 of this Regulation and to the adjustment pursuant to Article 10(2) of this Regulation, and taking into account any deduction resulting from the application of Article 7 of Decision No 406/2009/EC, each Member State shall ensure that its greenhouse gas emissions:

(a)do not exceed, in the years 2021 and 2022, the limit defined by a linear trajectory, starting on the average of that Member State’s greenhouse gas emissions in 2016, 2017 and 2018, as set out pursuant to paragraph 3 of this Article, and ending in 2030 at the limit set for that Member State in column 1 of Annex I to this Regulation; the linear trajectory of a Member State shall start either at five-twelfths of the distance from 2019 to 2020 or in 2020, whichever results in a lower annual emission allocation for that Member State;

(b)do not exceed, in the years 2023, 2024 and 2025, the limit defined by a linear trajectory, starting in 2022 at the annual emission allocation for that Member State, as set out pursuant to paragraph 3 of this Article for that year, and ending in 2030 at the limit set for that Member State in column 2 of Annex I to this Regulation;

(c)do not exceed, in the years 2026 to 2030, the limit defined by a linear trajectory, starting on the average of that Member State’s greenhouse gas emissions in 2021, 2022 and 2023, as submitted by that Member State pursuant to Article 26 of Regulation (EU) 2018/1999 and in accordance with paragraph 3 of this Article, and ending in 2030 at the limit set for that Member State in column 2 of Annex I to this Regulation; the linear trajectory of a Member State shall start at nine-twelfths of the distance from 2023 to 2024.

3. The Commission shall adopt implementing acts setting out the annual emission allocations for each Member State for the years from 2021 to 2030 in tonnes of CO2 equivalent in accordance with the linear trajectories set out in paragraph 2 of this Article.

For the years 2021 and 2022, the Commission shall determine the annual emission allocations based on a comprehensive review of the most recent national inventory data for the years 2005, 2016, 2017 and 2018, submitted by the Member States pursuant to Article 7 of Regulation (EU) No 525/2013, and shall indicate the value for the 2005 greenhouse gas emissions of each Member State used to determine those annual emission allocations.

For the years 2023, 2024 and 2025, the Commission shall determine the annual emission allocations based on the value for the 2005 greenhouse gas emissions of each Member State indicated pursuant to the second subparagraph of this paragraph and on the reviewed values of the national inventory data for the years 2016, 2017 and 2018 referred to in that second subparagraph.

For the years 2026 to 2030, the Commission shall determine the annual emission allocations based on the value for the 2005 greenhouse gas emissions of each Member State indicated pursuant to the second subparagraph of this paragraph and on a comprehensive review of the most recent national inventory data for the years 2021, 2022 and 2023 submitted by the Member States pursuant to Article 26 of Regulation (EU) 2018/1999.

4. The implementing acts referred to in paragraph 3 shall also specify, based on the percentages notified by Member States pursuant to Article 6(3), (3a) and (3b), the total quantities that may be taken into account for a Member State’s compliance under Article 9 between 2021 and 2030. If the sum of all Member States’ total quantities exceeds the collective total of 100 million, the total quantities for each Member State shall be reduced on a pro rata basis so that the collective total is not exceeded.’

;

(b)the following paragraph is added:

‘6.   When undertaking the actions to limit the greenhouse gas emissions under paragraphs 1 and 2, Member States shall consider the need to ensure a just and socially fair transition for all. The Commission may issue guidance to support Member States in that regard.’

;

(4)Article 5 is amended as follows:

(a)paragraph 1 is replaced by the following:

‘1.   In respect of the years 2021 to 2025, a Member State may borrow a quantity of up to 7,5 % from its annual emission allocation for the following year.’

;

(b)paragraphs 3 and 4 are replaced by the following:

‘3.   A Member State whose greenhouse gas emissions for a given year are below its annual emission allocation for that year, taking into account the use of flexibilities pursuant to this Article and Article 6, may:

(a)in respect of the year 2021, bank the excess part of its annual emission allocation up to a level of 75 % of its annual emission allocation for 2021 to subsequent years until 2030; and

(b)in respect of the years 2022 to 2029, bank the excess part of its annual emission allocation up to a level of 25 % of its annual emission allocations up to that year to subsequent years until 2030.

4. A Member State may transfer up to 10 % of its annual emission allocation for a given year to other Member States in respect of the years 2021 to 2025, and up to 15 % in respect of the years 2026 to 2030. The receiving Member State may use that quantity for compliance under Article 9 for the given year or for subsequent years until 2030.’

;

(c)the following paragraph is inserted:

‘5a.   Before any transfer of annual emission allocations pursuant to paragraphs 4 and 5, a Member State shall inform, in electronic form, the Climate Change Committee established by Regulation (EU) 2018/1999 of its intention to transfer part of its annual emission allocation for any given year.’

;

(d)paragraph 6 is replaced by the following:

‘6.   Member States should use revenues, or their equivalent in financial value, generated by transfers of annual emission allocations pursuant to paragraphs 4 and 5 to tackle climate change in the Union or in third countries. Member States shall inform the Commission of any actions taken pursuant to this paragraph and shall make that information public in an easily accessible form.’

;

(5)Article 6 is amended as follows:

(a)in paragraph 3, the second subparagraph is replaced by the following:

‘The Member States listed in Annex II may decide to revise the notified percentage once in 2024 and once in 2027. In such case, the Member State concerned shall notify the Commission thereof by 31 December 2024 or by 31 December 2027, respectively.’;

(b)the following paragraphs are inserted:

‘3a.   Malta shall notify the Commission by 31 December 2023 if it intends to make use of the limited cancellation of EU ETS allowances referred to in paragraph 1 of this Article, up to the percentage listed in Annex II for each of the years 2025 to 2030, for its compliance under Article 9.

3b.   Notwithstanding paragraph 3, the Member States listed in Annex II which have not notified the Commission by 31 December 2019 of an intention to make use or full use of the limited cancellation of EU ETS allowances referred to in paragraph 1 of this Article shall notify the Commission by 31 December 2023 if they intend to make use or further use of that limited cancellation of EU ETS allowances, up to the percentage listed in Annex II for each year of the period from 2025 to 2030 for each Member State concerned, for its compliance under Article 9.’

;

(c)paragraphs 4 and 5 are replaced by the following:

‘4.   At a Member State’s request, the Central Administrator designated pursuant to Article 20(1) of Directive 2003/87/EC (the “Central Administrator”) shall take into account an amount up to the total quantity determined pursuant to Article 4(4) of this Regulation for that Member States’ compliance under Article 9 of this Regulation. One-tenth of the total quantity of EU ETS allowances determined pursuant to Article 4(4) of this Regulation shall be cancelled pursuant to Article 12(4) of Directive 2003/87/EC for each year from 2021 to 2030 for that Member State. One-sixth of the total quantity of EU ETS allowances determined pursuant to Article 4(4) of this Regulation shall be cancelled pursuant to Article 12(4) of Directive 2003/87/EC for each year from 2025 to 2030 for Member States that have notified the Commission pursuant to paragraphs 3a and 3b of this Article.

5. Where a Member State, in accordance with paragraph 3, has notified the Commission of its decision to revise the previously notified percentage, a correspondingly lower or higher quantity of EU ETS allowances shall be cancelled for that Member State in respect of each year from 2026 to 2030 or from 2028 to 2030, respectively.’

;

(6)Article 7 is amended as follows:

(a)the title is replaced by the following:

‘Additional use of net removals from LULUCF’;

(b)paragraph 1 is amended as follows:

(i)the introductory sentence is replaced by the following:

‘1.   To the extent that a Member State’s greenhouse gas emissions exceed its annual emission allocations for a given year, including any annual emission allocations banked pursuant to Article 5(3) of this Regulation, a quantity up to the sum of total net removals and total net emissions from the combined land accounting categories included in the scope of Regulation (EU) 2018/841, may be taken into account for its compliance under Article 9 of this Regulation for that year, provided that:’

;

(ii)point (a) is replaced by the following:

‘(a)the cumulative quantity taken into account for that Member State for the years 2021 to 2025 does not exceed half of the maximum amount of total net removals set out in Annex III to this Regulation for that Member State;

(aa)the cumulative quantity taken into account for that Member State for the years 2026 to 2030 does not exceed half of the maximum amount of total net removals set out in Annex III to this Regulation for that Member State;’;

(c)paragraph 2 is deleted;

(7)Article 8 is replaced by the following:

‘Article 8

Corrective action

1. If the Commission finds, in its annual assessment under Article 29 of Regulation (EU) 2018/1999 and taking into account the intended use of the flexibilities referred to in Articles 5, 6 and 7 of this Regulation, that a Member State is not making sufficient progress towards meeting its obligations under Article 4 of this Regulation, that Member State shall, within three months, submit to the Commission a corrective action plan that includes:

(a)a detailed explanation of why that Member State is not making sufficient progress towards meeting those obligations;

(b)an assessment of how Union funding has supported that Member State’s efforts towards meeting those obligations and of how it intends to use such funding to make progress towards meeting them;

(c)additional actions, complementing the integrated national energy and climate plan of that Member State pursuant to Regulation (EU) 2018/1999 or reinforcing its implementation, that it is to implement in order to meet those obligations, through domestic policies and measures and the implementation of Union action, accompanied by a detailed assessment, which is underpinned by quantitative data, where available, of the envisaged greenhouse gas emission reductions resulting from those actions;

(d)a strict timetable for implementing such actions, which enables the assessment of annual progress in implementation.

Where a Member State has established a national climate advisory body, it may seek its advice to identify the necessary actions referred to in point (c) of the first subparagraph.

2. In accordance with its annual work programme, the European Environment Agency shall assist the Commission in its work to assess any such corrective action plans.

3. The Commission may issue an opinion regarding the robustness of the corrective action plans submitted in accordance with paragraph 1 and shall in that case do so within four months of receipt of those plans. The Member State concerned shall take utmost account of the Commission’s opinion and may revise its corrective action plan accordingly. If the Member State concerned does not address the Commission’s opinion or a substantial part thereof, that Member State shall provide a justification to the Commission.

4. Each Member State shall make its corrective action plan as referred to in paragraph 1 and any justification as referred to in paragraph 3 publicly available. The Commission shall make its opinion as referred to in paragraph 3 publicly available.’

;

(8)in Article 9, paragraph 2 is replaced by the following:

‘2.   If the greenhouse gas emissions of a Member State in the period from 2021 to 2025 referred to in Article 4 of Regulation (EU) 2018/841 exceeded its removals, as determined in accordance with Article 12 of that Regulation, the Central Administrator shall deduct from that Member State’s annual emission allocations an amount equal to those excess greenhouse gas emissions in tonnes of CO2 equivalent for the relevant years.’

;

(9)Article 15 is replaced by the following:

‘Article 15

Review

1. This Regulation shall be kept under review taking into account, inter alia, evolving national circumstances, the manner in which all sectors of the economy contribute to the reduction of greenhouse gas emissions, international developments and efforts undertaken to achieve the long-term objectives of the Paris Agreement and of Regulation (EU) 2021/1119.

2. The Commission shall submit a report to the European Parliament and to the Council, within six months of each global stocktake agreed under Article 14 of the Paris Agreement, on the operation of this Regulation, including the balance between supply and demand for annual emission allocations, as well as on the suitability of the national greenhouse gas emission reduction targets contained in Annex I to this Regulation as regards their contribution to the Union’s climate objectives pursuant to Regulation (EU) 2021/1119 and to the goals of the Paris Agreement. That report shall include in particular an assessment of the need for additional Union policies and measures in view of the necessary greenhouse gas emission reductions by the Union and its Member States in a post-2030 framework. It shall also include an assessment of a reduction pathway for the greenhouse gas emissions covered by this Regulation that is compatible with the objective of climate neutrality at the latest by 2050, taking into account the projected indicative Union greenhouse gas budget referred to in Article 4(4) of Regulation (EU) 2021/1119 as well as the importance of promoting both fairness and solidarity among Member States and cost-effectiveness in achieving that objective. That report may be accompanied, if appropriate, by legislative proposals.

The report referred to in the first subparagraph shall take into account the long-term strategies of Member States prepared and submitted pursuant to Article 15(1) of Regulation (EU) 2018/1999 and the assessment thereof made by the Commission pursuant to Article 15(9) of that Regulation.’

;

(10)the following Article is inserted:

‘Article 15a

Scientific advice

The European Scientific Advisory Board on Climate Change, established under Article 10a of Regulation (EC) No 401/2009 of the European Parliament and of the Council (*3), (the “Advisory Board”) may, on its own initiative, provide scientific advice or issue reports on Union measures, climate targets, annual emission levels and flexibilities under this Regulation. The Commission shall consider the relevant advice and reports of the Advisory Board, in particular as regards future measures aiming at further greenhouse gas emission reductions in the sectors covered by this Regulation.

(*3)  Regulation (EC) No 401/2009 of the European Parliament and of the Council of 23 April 2009 on the European Environment Agency and the European Environment Information and Observation Network (OJ L 126, 21.5.2009, p. 13).’;"

(11)Annexes I, II and III are amended in accordance with the Annex to this Regulation.

Article 2

Amendments to Regulation (EU) 2018/1999

Regulation (EU) 2018/1999 is amended as follows:

(1)in Article 26, paragraph 3 is replaced by the following:

‘3.   From 2023, Member States shall determine and report to the Commission final greenhouse gas inventory data by 15 March each year (year X) and preliminary greenhouse gas inventory data by 15 January each year, including the greenhouse gases and the inventory information listed in Annex V. The report on the final greenhouse gas inventory data shall also include a complete and up-to-date national inventory report. Within three months of receiving the reports, the Commission shall make the information referred to in point (n) of the first paragraph of Part 1 of Annex V available in electronic form to the Climate Change Committee referred to in point (a) of Article 44(1).’

;

(2)in Annex V, Part 1, first paragraph, point (n) is replaced by the following:

‘(n)information on:

(i)the Member State’s intentions to make use of the flexibilities referred to in Article 5(4) and (5) of Regulation (EU) 2018/842, including, where possible, information regarding quantities, type of transfer and estimated range of prices;

(ii)the use of revenues under Article 5(6) of Regulation (EU) 2018/842;

(iii)the Member State’s intentions to make use of the flexibility referred to in Article 7(1) of Regulation (EU) 2018/842.’.

Article 3

Entry into force

This Regulation shall enter into force on the twentieth day following that of its publication in the Official Journal of the European Union.

This Regulation shall be binding in its entirety and directly applicable in all Member States.