Commission Regulation (EU) No 1210/2011 of 23 November 2011 amending Regulation (EU) No 1031/2010 in particular to determine the volume of greenhouse gas emission allowances to be auctioned prior to 2013 Text with EEA relevance
Commission Regulation (EU) No 1210/2011of 23 November 2011amending Regulation (EU) No 1031/2010 in particular to determine the volume of greenhouse gas emission allowances to be auctioned prior to 2013(Text with EEA relevance)THE EUROPEAN COMMISSION,Having regard to the Treaty on the Functioning of the European Union,Having regard to Directive 2003/87/EC of the European Parliament and of the Council of 13 October 2003 establishing a scheme for greenhouse gas emission allowance trading within the Community and amending Council Directive 96/61/ECOJ L 275, 25.10.2003, p. 32., and in particular Articles 3d(3) and 10(4) thereof,Whereas:(1)Commission Regulation (EU) No 1031/2010 of 12 November 2010 on the timing, administration and other aspects of auctioning of greenhouse gas emission allowances pursuant to Directive 2003/87/EC of the European Parliament and of the Council establishing a scheme for greenhouse gas emission allowances trading within the CommunityOJ L 302, 18.11.2010, p. 1. provides for determining the volumes of any allowances to be auctioned in 2011 and 2012 as soon as practicable following its adoption. The volumes so determined are to be listed in an Annex to that Regulation. The foremost objective in specifying the volume is to ensure a smooth transition from the second to the third trading period of the Union Emissions Trading Scheme that underpins the proper functioning of the secondary market.(2)When determining the volumes to be auctioned in 2011 and 2012, due account should be taken of factors determining demand for and supply of allowances, notably hedging needs for compliance in the early years of the third trading period in particular from the power sector; the volume of allowances valid for the second trading period not needed for compliance in the said trading period and which is held largely by the industrial sectors; the share of those allowances that has been and is likely to be sold on the market in the second trading period; the volume of certified emission reductions and emission reduction units stemming from emission reduction projects under the Clean Development Mechanism or under Joint Implementation provisions available for hedging or for surrendering by operators covered by the Union Emissions Trading Scheme; and the monetisation of allowances from the new entrant reserve for the third trading period for support of demonstration projects of carbon capture and sequestration and innovative renewable energy technologies (NER300) pursuant to Commission Decision 2010/670/EU of 3 November 2010 laying down criteria and measures for the financing of commercial demonstration projects that aim at the environmentally safe capture and geological storage of CO2 as well as demonstration projects of innovative renewable energy technologies under the scheme for greenhouse gas emission allowance trading within the Community established by Directive 2003/87/EC of the European Parliament and of the CouncilOJ L 290, 6.11.2010, p. 39.. Although all these factors are subject to different degrees of uncertainty, it is important to determine the volume to be auctioned in 2012 in a timely manner.(3)The assessment based on those factors concludes that no allowances valid for the third trading period should be auctioned in 2011.(4)The auction calendars for the auctioning of allowances in 2012 should be determined such as to limit the impact of the auctions on the functioning of the secondary market, whilst ensuring that auctions are large enough to attract sufficient participation. There should be a smooth transition from the auctioning on transitional auction platforms to the auctioning on later auction platforms. Moreover, adjustment of a published auction calendar could be justified in certain additional precisely specified situations.(5)Since delivery of the allowances to be auctioned can be expected to be enabled in time, there is no need for transitionally auctioning forwards and futures. The procurement of a transitional auction platform remains, however, desirable in order to mitigate risk inherent to the procurement of the auction platform to which the Regulation will apply in full. Given the importance of the full application of the Regulation, transitional auction platforms should conduct auctions no longer than necessary. The appointment of a transitional auction platform should be facilitated by imposing fewer requirements on the conduct of its auctions, as was already foreseen for the auctioning of forwards and futures. In this way, the services to be procured can remain more aligned to services already existing in the market. In addition, the application of the national measures transposing Title III of Directive 2004/39/EC of the European Parliament and of the CouncilOJ L 145, 30.4.2004, p. 1. to the auctions conducted by a transitional auction platform is not indispensable. Similarly, it would be disproportionate to require the authorisation of the transitional auction platform to be updated in accordance with the requirements of the Auctioning Regulation. However, in order to ensure effective market oversight, the provisions in the present Regulation relating to the prohibition of market abuse should apply to auctions conducted on a transitional auction platform from the moment the Member State concerned has implemented the relevant provisions in national law. This encourages a level playing field between candidate auction platforms without making the start of the auctions dependent on such implementation. This applies to the transitional auction platform to be procured by means of a joint procurement procedure, as well as to transitional auction platforms to be appointed by Member States that do not join the joint action and appoint their own auction platform.(6)It is not necessary to distribute the share of the costs of the auction monitor attributable to services procured by the Commission over the number of auction platforms.(7)For efficient and adequate preparation and conduct of the joint procurement procedure to appoint a common auction platform, it is desirable to have timely clarity on participation by Member States in that joint action. Therefore, in certain situations, it should be possible that a Member State that starts making use of the common auction platform at a later stage bears costs attributable to services provided by an auction platform not borne by Member States participating in the joint action from the start.(8)The appointment of the auctioneers and the auction monitor is of crucial importance for the proper conduct of the auctions and it would generally not be possible to conduct auctions without the conclusion and entry into force of the arrangements between the auctioneers and the auction monitor on the one side and the auction platforms on the other. These arrangements should be properly implemented, but the non-implementation, or a dispute on the implementation, should not in all situations lead to withholding allowances from the auctions.(9)The auction monitor is to be appointed following a joint procurement procedure between the Commission and the Member States. Although it is foreseen that all Member States participate in this joint action from the outset, it is appropriate to provide rules in case a Member State joins only at a later stage. Moreover, Member States that have decided to appoint an auction platform of their own should be able to join the joint action for the sole purpose of making use of a common auction platform in the absence of listing of the auction platform of their own, without prejudice to their observer status in that joint action.(10)The risk of insider trading by withdrawing a bid should be mitigated. Where such behaviour is not covered by Directive 2003/6/EC of the European Parliament and of the CouncilOJ L 96, 12.4.2003, p. 16., the relevant provisions in the Auctioning Regulation should apply.(11)A limited number of technical clarifications and corrections to the Auctioning Regulation should be provided for in this Amendment.(12)Regulation (EU) No 1031/2010 should therefore be amended accordingly.(13)In order to ensure predictable and timely auctions, this Regulation should enter into force as a matter of urgency.(14)The measures provided for in this Regulation are in accordance with the opinion of the Climate Change Committee,HAS ADOPTED THIS REGULATION: