Compliance with the EU ETS

Case Study on the German Implementation

Master's Thesis from the year 2012 in the subject Law - Miscellaneous, Maastricht University (Faculty of Law), course: Environmental Law, language: English, abstract: [...] Subject of the examination of the paper is the system of enforcement the EU ETS provides in the field of monitoring, reporting and verifying by analyzing the compliance tools and by taking the German implementation as an example to review problems and case law of the first trading periods. Since a sound system of enforcement provided by the EU-ETS to ensure compliance is extremely important, the second chapter of this thesis will review the mechanism foreseen in the directive, the so-called compliance cycle, which is based on monitoring, reporting and verifying; taking into account also the enforcement system's unique characteristics in contrast to other environmental law instruments. After documenting the obligation of the operators of the installations covered by the directive have, like monitoring and constantly reporting on their emission in order to achieve the permission to emit, possibly appearing problems will be shown. Since the member states themselves are in charge of enforcement and therefore control the obligations of operators and verifier provided in the Directive 2003/87 in connection with the Monitoring and Reporting Guidelines of the Commission, in the third chapter of this thesis a case study will show how this challenge is implemented practically on the German example. More specifically, after analyzing the framework given by the EU in the Directive 2003/87, it will be analyzed throughout the third chapter how the German legislator coped with the challenge of implementing an effective system and what possible weaknesses are detected. Moreover, it will be reviewed what problems the operators have been facing in the first trading periods and also how the German authorities dealt with upcoming challenges. Due to the different operators and the different steps within the compliance cycle, different defects at different levels may appear: incomplete or incorrect data can be forwarded by the installation operators, verification by the private verifier could be biased in favor for one party and installations can emit more than they are allowed to. Additionally case law will show what role the courts in the compliance system play and how their decisions influenced the development of the enforcement system in Germany. At last section four of this article provides some concluding remarks.