Welcome to the final issue of the SETatWork Newsletter:

The SETatWork project was supported by the EU's 7th Framework Programme (FP7). It assisted European industries with meeting the challenge of climate change and bridging contacts to market actors and researchers outside Europe.

This issue of the newsletter summarises the Achievements and Conclusions of the SETatWork project including details of reports on Achieving Energy Efficiency and Savings in the Carbon Markets, and SETatWork Strategy.

Although the project has now ended and the website will no longer be updated, the resources on the website will continue to be available at least until the end of 2013.

In addition, copies of the website including all publications will be available on CD-ROM, from the SETatWork Project Partners, while stocks last.

For further information about SETatWork or any of the issue raised on this website please contact: info@setatwork.eu

Reproduction of this publication is authorised provided the source is acknowledged.

SETatWork is supported by the European Commission under the Seventh Framework Programme (FP7) under contract TREN/FP7EN/219009-"SETatWork". This publication reflects the authors' views. Although the authors' best efforts have been made to ensure that the information contained herein is accurate, neither the European Commission, the SETatWork Project Members nor the author are liable for any use that may be made of the info rmation contained herein.

The core focus of SETatWork was to mobilise market actors and researchers with a view to promoting sustainable energy technologies in the carbon markets.   

During the first year of action, the main needs and interests of companies in the targeted European Emission Trading Scheme (EU ETS) sectors in Portugal, Bulgaria, Italy, Germany, Slovakia, Poland, Sweden and Denmark were assessed in terms of CO₂ handling. Based on this, the respective partners carried out training services and identified project opportunities in the industries, including arranging ETS matchmaking events.  In parallel, the SETatWork partners examined opportunities for CDM projects in China, Thailand, Africa and Chile, including the prospects for technology transfer.

With the organization of nearly 20 training events addressed to representatives from the energy industries, Sustainable Energy Technology (SET) developing companies and other political stakeholders in the EU ETS countries, SETatWork contributed to the capacity-building and know-how of relevant market players. In addition to the training workshops, the organisation of 22 matchmaking events assisted in the establishment of business contacts between representatives of EU ETS countries and CDM/JI countries.

Altogether, the project events involved more than 2,000 attendees from industry, research institutes, technology providers, financial sector etc. and helped to catalyse appropriate new research and business relations.

In addition, SETatWork partners carried out studies of the carbon market development, and the related challenge of creating a sound business framework, for both the ETS and CDM sectors. This has been supported by a range of dissemination activities anchored around this SETatWork website www.setatwork.eu. During the project period to October 2010, this site provided excellent and updated information on various aspects of the international carbon markets (e.g. country profiles with description of the carbon markets, information on good practice technologies, database on service providers, SET companies, financing schemes for carbon projects, etc.), but also on ongoing market development. Although the website will no longer be updated, this information will continue to be available until at least the end of 2013.

As a supplementary activity to the market observance and dissemination, SETatWork undertook a strategy work with a view to identifying what initiatives could be taken to foster appropriate innovations and interaction of market actors and researchers. The strategy process has been built on the studies made in the partner countries, as well as two roundtable meetings in Brussels with EU branch organisations.

The main conclusion of the project, resulting from an assessment of needs as well as interaction with stakeholders is that in addition to the implementation of the EU ETS there is a need to offer further instruments and/or incentives to industry. These could include energy management schemes. As a result of the SETatWork team examining existing experience, the project suggests the need for future initiatives in terms of in-house measures in the ETS sector as well as ways of bringing EU actors into the international carbon markets. Both activities will require substantial support to enable Europe to fulfil its policy obligations as well as to take advantage of the ‘green technology revolution’.

In the wake of COP16 at Cancun, it is up to the European Community to take the appropriate actions in order to realise such potential, gaining inspiration and benefit from SETatWork’s network oriented and catalytic approach.

Find out more in the SETatWork Summary Reports described below.

SETatWork: Sustainable Energy Technology at Work - Thematic Promotion of Energy Efficiency and Energy Saving Technologies in the Carbon Markets Achieving Energy Efficiency and Savings in the Carbon Markets Short Report (Web Quality 1716 Kb PDF) Short Report (Print Quality 3894 Kb PDF) A more detailed, 30 page report is also available: D2.6 SETatWork - Achieving Energy Efficiency (656 Kb PDF)

Both the Short (12 page) and Full (30 page) versions of this report summarise the activities and results of the SETatWork project, with sections on:

1. SETatWork Achievements
   Objectives and Working Structure
   The SETatWork Consortium
2. SETatWork in a Dynamic International Carbon Market
   Review of EU Emissions Trading Scheme in 2009
   The UN Negotiations on Climate Change: From Copenhagen to Cancun
3. SETatWork Interventions into the Carbon Markets
   SETatWork Database and Partner Matching Facilities
   SETatWork COP Interventions and Roundtable Events
   SETatWork Matchmaking Events targeting the CDM markets
   SETatWork Training Workshops and Matchmaking Events in EU countries
   SETatWork Good Practice Case Studies

Additional information can be found in the publications section of the website including the report on Strategy, described below.

D6.4 SETatWork Strategy Report (879 Kb PDF)

This 62 page summary report includes the following sections:

1. Introduction and background
   1.1 EU challenge & policy measures
   1.2 SETatWork action and strategy approach
   1.3 Conclusion of present situation in selected ETS market
   1.4 Conclusion of present situation in selected CDM market
   1.5 Conclusion COP 15
   
2. Overall EU industry sector strategy
   2.1 Allocation post 2013
   2.2 Carbon leakage
   2.3 Industry worries
   
3. Observations of SETatWork intervention
   3.1 SETatWork need assessment & training of the ETS sector
   3.2 Assessment of industry support schemes
   3.3 Dialogue between SETatWork and industry
   
4. Selected ETS member strategies
   
5. Selected CDM member strategies
   
6. Technology transfer
   
7. Interaction with EU and other actions
   7.1 Conclusion
   
8. APPENDICES
   8.1 APPENDIX 1 Present situation in selected EU ETS countries
   8.2 APPENDIX 2 Present situation in selected CDM markets
   8.3 APPENDIX 3 Main challenges and actions for selected ETS markets
   8.4 APPENDIX 4 Main challenges and actions for selected CDM markets
   

This article is extracted from the report on Achieving Energy Efficiency and Savings in the Carbon Markets described above. The report was produced by Josef Konradl, André Suck (KEWOG ZREU, Germany), Nils Daugaard (ECNet, Denmark) and Markus Götz (FutureCamp, Germany) on behalf of the SETatWork Consortium.

In February 2007, the EU Environmental Ministers adopted revised climate policy targets for the European Union. They defined a general objective whereby global CO₂ emissions should be reduced by 50 % by 2050 compared with 1990 levels, and that the reduction for developed countries should be in the range of 60-80 %. To achieve this objective, the EU committed itself unilaterally to reduce CO₂ emissions by 20 % by 2020.

These goals were further substantiated in January 2008, and on 6 April 2009, the Council of the European Union adopted a climate-energy legislative package. The package is designed to achieve the EU’s overall environmental target of a 20 % reduction in greenhouse gases and a 20% share of renewable energy in the EU’s total energy consumption by 2020.1 In addition to new rules for the promotion of renewable energy sources, the legislative package also contains revised legislation for the EU Emissions Trading System. The amended legislation is aimed to achieve greater emission reductions in energy-intensive sectors.2

Under the revised ETS, GHG emissions allowances will no longer be given to operators for free, but will be partly auctioned by Member States. Operators of industrial and heat-producing installations (including CHP) must start by purchasing 20 % of the EU allowances (EUA) through auctions from 2013 onwards. That rate will rise gradually to 70 % in 2020, with a view to reaching 100 % in 2027.  Specific regulations apply to electricity generators – in order to prevent windfall profits, they are obliged to acquire all of their EUAs at auctions, though a number of exemptions in the electricity sector cover ten countries with high dependence on fossil fuel or insufficient connection to the European electricity grid.3

Each EU state will determine the use of its revenues from auctioning its pollution allowance. At least half of the proceeds should be used to fight climate change and to alleviate the social consequences of moving towards a low-carbon economy. The revised ETS will apply from the start of its third trading period on 1 January 2013. Member States must bring the legislation necessary for compliance with the directive into force by 31 December 2012 [Council of the European Union 2009].

The United Nations Climate Change Conference (COP 15 /CMP 5) in Copenhagen, Denmark took place from 7-19 December 2009. The main objective of the conference was to deliver a new treaty to follow on from the Kyoto Protocol4, which concludes in 2012. The conference resulted in a political agreement - the "Copenhagen Accord" - which, in summary, provided the following achievements:

• Shared Vision: The agreement "recognizes the scientific view that the increase in global temperature should be below 2 degrees Celsius."
• Mitigation: Provides Economy-wide emissions targets for Annex I (developed) countries for 2020 while Non-Annex I (developing) countries "will implement mitigation actions". Actions for which developing countries are seeking support will be recorded in a (National Appropriate Mitigation Actions - NAMA) registry.
• Adaptation: Adequate, predictable and sustainable finance, technology and capacity-building should be provided to support the implementation of adaptation actions in developing countries, especially for those that are particularly vulnerable.
• Finance: There should be a USD 30 billion collective commitment of developed countries for 2010-2012, with USD 100 billion a year mobilized jointly by 2020 with long-term finance consisting of public and private resources generating a new "Copenhagen Green Climate Fund"
• Monitoring, reporting and verification (MRV):5 The Copenhagen Accord establishes that “mitigation actions including national inventory reports, shall be communicated through national communications … every two years on the basis of guidelines …” while the “supported nationally appropriate mitigation actions will be subject to international measurement, reporting and verification in accordance with guidelines to be adopted by the Conference of the Parties.”
  
• Technology: A new Technology Mechanism will be established in order to enhance action on development and transfer of technology.
• REDD-plus: Immediate establishment of a mechanism to enable the mobilization of financial resources from developed countries.

Overall the COP 16 negotiations in Cancun led to some further progress for achieving a later Post-Kyoto-Agreement. Essential progress was made in the following four main issues [UNFCCC 2010]: Adaptation; Mitigation; Measurement, Reporting and Verification (MRV); Finance, Technology and Capacity-building.

Within the topic of Adaptation6, the Parties reached an agreement on the establishment of the Cancun Adaptation Framework, including an Adaptation Committee, which will initiate a process between developed and developing countries that should result in better cooperation in developing long-term strategies to adapt to the impacts of climate change. In terms of Mitigation, the final Cancun text did not outline tighter emission targets for any nation. Instead it refers to figures that will be published later, covering cuts from industrial and developing nations. The main outcome of the mitigation topic is summarised in the following figure, that differentiates between Parties from developed and those from developing countries.

In relation to the issue of Measurement, Verification and Reporting (MRV), the COP 16 negotiations resulted in an initial agreement to negotiate more binding targets for developing countries. Further modalities and guidelines for MRV will have to be specified in later negotiations at COP 17 in Durban.

The initial resolutions in MRV also contain promising results in the topics Financing and Technology:

Essential progress was also achieved in establishing a mechanism to enable the mobilization of financial resources from developed countries for tropical forest protection (REDD+). In summary, significant improvements were realised during the COP meeting in Cancun restoring the credibility of the United Nations as a forum where progress can be made in Climate Change Policy [Bloomberg 2010]. This included initiation of the “Cancun Adaptation Framework” that would help assess the needs of the most vulnerable nations in adapting to climate change and establishment of a Green Climate Fund that would manage a “significant share” of the $100 billion pledged until 2020. It also made significant progress in MRV, which is to be developed in later UN negotiations and suggested a technology mechanism to help developing nations benefit from low-carbon products such as wind turbines, solar panels, etc.).

Footnotes