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European Law Monitor newsEmissions Trading: allegations of double counting are incorrect

The Commission has verified and can confirm that the number of allowances put out of circulation (retired) in 2005 and 2006 corresponds to the number of verified emissions reported by companies in 2005 and 2006.

Companies must surrender allowances equivalent to their actual emissions each year to the government. Governments then in turn must retire units to the UNFCCC for the country's overall emissions, but this retirement can involve not only allowances, but also certified emissions reduction units, emission reduction units, etc. Therefore, the country is not required to retire the very same allowances that were surrendered by companies, but only an amount equivalent thereto.

As a result of this flexibility, it is possible that in several cases Member States allocate several times over in the same year or take allowances out of circulation that have never been given to companies but were reserved for new entrants. This way of "accounting" is in line with the relevant legislation (Commission Regulation No 2216/2004 of 21/12/2004 for a standardized and secured system of registries pursuant to Directive 2003/87/EC of the EP and Council and Decision No 280/2004/EC of the EP and the Council).

Any allegation that there would have been double counting is pertinently incorrect.