The EU Emissions Trading Scheme - A multi-million deal for German industry

As a result of the free allocation of emission allowances under the EU Emissions Trading Scheme (EU ETS), German energy producers are able to reap several billion and German industrial companies several hundred million Euros of additional revenue in the first and second trading periods (2005-2012) of the scheme.

As a result of the free allocation of emission allowances under the EU Emissions Trading Scheme (EU ETS), German energy producers are able to reap several billion and German industrial companies several hundred million Euros of additional revenue in the first and second trading periods (2005-2012) of the scheme. A study conducted by Öko-Institut on behalf of WWF Germany arrived at the conclusion that in particular the energy-intensive companies whose allocation significantly exceeded their emissions are able to accrue substantial profits on the basis of the EU ETS.

The five largest electricity producers in Germany have drawn additional profits of almost 40 billion Euros from the EU ETS:

  • E. ON € 12 billion
  • RWE € 11.3 billion
  • Vattenfall Europe € 7.2 billion
  • EnBW € 6.4 billion
  • Evonik € 2.1 billion.

The following four industrial companies have benefited the most in Germany:

  • for ThyssenKrupp over-allocation amounts to € 384 million;
  • for Salzgitter over-allocation amounts to € 243 million;
  • for BASF over-allocation amounts to € 104 million;
  • for Heidelberg Cement over-allocation amounts to € 43 million.

Furthermore, based on the right to use project-based credits under the EU ETS, the selected German companies have overwhelmingly (83 %) used credits from CDM projects that are ecologically highly questionable.

In the third trading period of the EU ETS the over-allocation to industry is to be avoided through the use of ambitious benchmarks and the quantitative and qualitative restriction on the use of certain CDM credits. Renewed over-allocation should be prevented by making no exceptions to the benchmarks for free allocation from 2013 onwards. It is expected that this will also provide incentives for the structural decarbonisation of industry. Moreover, the use of CDM credits originating from ecologically questionable projects should no longer be allowed.

Download the study “Free allocation of emission allowances and CDM/JI credits within the EU ETS - Analysis of selected industries and companies in Germany” as a PDF-file here >>.

For further information please contact

Dr. Felix Chr. Matthes
Researcher Coordinator Energy- and Climate policy
Öko-Institute, Berlin Office
Phone +49-30/405085-80
E-Mail contact

Hauke Hermann
Researcher, Energy & Climate Division
Öko-Institute, Berlin Office
Phone +49-30/405085-80
E-Mail contact