Weishaar, Stefan --- "EU Greenhouse Gas Emissions Trading and Competition Law" [2008] ELECD 418; in Faure, Michael; Peeters, Marjan (eds), "Climate Change and European Emissions Trading" (Edward Elgar Publishing, 2008)

Book Title: Climate Change and European Emissions Trading

Editor(s): Faure, Michael; Peeters, Marjan

Publisher: Edward Elgar Publishing

ISBN (hard cover): 9781847208989

Section: Chapter 6

Section Title: EU Greenhouse Gas Emissions Trading and Competition Law

Author(s): Weishaar, Stefan

Number of pages: 27

Extract:

6. EU greenhouse gas emissions trading
and competition law
Stefan Weishaar

INTRODUCTION
This chapter addresses Competition law issues that arise under the European
Emissions Trading System (EU ETS). Where appropriate, comments on the
proposed amendment of Directive 2003/87/EC1 that emphasizes auctioning
and benchmarking are made. Pursuant to the proposal of the European
Commission, sectors exposed to strong international competition and that give
rise to carbon leakage will benefit from free allocation. Sectors other then
electricity ­ electricity will in principle not benefit from any free allocation2 ­
will be subject to ever more auctioning.3 A transitory rule envisages a partial
free allocation of 80% of the average measured emissions during the period
2005­2007. The free allocation is reduced annually by equal amounts so that
by 2020 free allocation will have completely faded out in these sectors.4
Undue interventions by Member States are largely foreclosed through the
application of the four freedoms, while EC Competition law (Articles 81 and
82 EC Treaty) is geared to the prevention of competitive distortions arising in
particular from undue behaviour of firms. Not prejudicing the application of
the four freedoms, Member States' involvement in practices that distort
competition between undertakings is addressed through the application of EU
Competition law rules. There are two main alleys in which unduly distorting
State measures taken within the EU ETS framework can be contained. Firstly,
through the joint application of Articles 3(g), 10(2), 81 and 82 EC Treaty
which was developed by the ECJ ...