Climate Law in EU Member States
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Climate Law in EU Member States

Towards National Legislation for Climate Protection

Edited by Marjan Peeters, Mark Stallworthy and Javier de Cendra de Larragán

The complex and multifaceted nature of EU climate legislation poses a major challenge for EU member states. This timely book focuses on national climate action, addressing the regulatory responses required for the purposes of meeting greenhouse gas emissions reduction objectives for 2020 (and beyond).
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Chapter 4: Regulating greenhouse gas emissions from EU ETS installations: what room is left for the member states?

Lorenzo Squintani, Marijn Holwerda and Kars de Graaf


A cornerstone of the EU’s policy to combat climate change is the EU Emissions Trading System (ETS), introduced by the Emissions Trading System Directive (ETS Directive) in 2005. This chapter focuses on the relationship between the ETS Directive and the Integrated Pollution Prevention and Control Directive (IPPC Directive) as well as its recently adopted successor, the Industrial Emissions Directive (IE Directive), and examines the leeway for member states to impose emission reduction requirements on EU ETS sources. The ETS is an example of a market-based instrument, while the IPPC Directive represents a command-and-control instrument. The EU chose the market-based instrument of emissions trading for regulating the greenhouse gas emissions from its large industries. In order to clarify the interaction and guarantee a smooth interplay between the two directives, Article 9(3)(iii) IPPC Directive was introduced to allow operators to directly control the emissions of greenhouse gases that are regulated under the ETS Directive from their installations, including increasing them if desired. This article therefore provides that permits issued under the IPPC Directive shall not contain an emission limit value (ELV) for direct emissions of those gases unless necessary to ensure that no significant local pollution is caused. An ELV is a particular kind of emission performance standard (EPS). It is the mass, expressed in terms of certain specific parameters, concentration and/or level of an emission, which may not be exceeded during one or more periods of time.

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