Emissions trading scheme

Author: | Published: 1 Jul 2005
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Raposo Bernardo & Associados

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Lisbon

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+351 21 312 13 30

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+351 21 356 29 08

As the Kyoto Protocol established serious commitments to curtail greenhouse gas emissions, transposition of the EU Emissions Trading Directive took place in Portugal, implementing an emission allowances trading scheme and providing the necessary framework within EU guidelines.

According to Portuguese rules, operators and industrial installations responsible for greenhouse gas emissions must hold, and surrender at the end of each year (or April 30 of the following year at the latest), allowances proportionate with their total emissions over the previous year.

The rules apply to installations operating in the energy sector, iron and steel production and processing. The mineral industry and the paper and card industry will also be subject to the emission-trading scheme. These industries will only be allowed to function if they hold an emission allowance, which is a certificate entitling its holder to emit a tonne of carbon dioxide or an amount of any other greenhouse gas with an equivalent global warming potential during a specified period.

So the operator - any person, natural or legal, who operates or controls an installation or to whom decisive economic power over the technical functioning of the installation has been delegated - should hold as many allowances as its certified greenhouse gas emissions.

From May 1 2008 and for four months into each new five-year period, allowances that are no longer valid but were not surrendered by their holders will be officially cancelled by the Institute for the Environment, who is also responsible for allocating new allowances to replace cancelled ones.

Rita Tavares de Almeida