Emission Trade

The European Union Emission Trading Scheme (EU ETS) is the world’s single largest market of emission allowances. It covers some 11.000 large industrial installations responsible for 40 % of the EU’s greenhouse gas emissions. Operators of such installations have to buy certificates permitting them to emit greenhouse gases; the purpose of this system is to create a financial incentive to increase their energy efficiency, reducing the need to buy expensive emission allowances.

However, the EU ETS also allows the “generation” of certificates, provided that the corresponding amount of emissions is being reduced elsewhere; that way, the operation of the installation does not increase the total exhaust of greenhouse gases and no additional certificates are needed.

Certificates are only issued if the reduced emissions support also sustainable development in the respective country. This is where emisciency comes into play: We use the revenues from the sale of such certificates to give financial aid for the modernisation of equipment and facilities in India and Malaysia and, that way, increase both their competitiveness and standard of living.

If you want to read more about the (dys)function of the EU ETS, take a look at our co-founder Dirk’s presentation on this topic.