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Dutch coal shutdown plan would displace emissions

22 Feb 2016 17:13 GMT
Dutch coal shutdown plan would displace emissions

London, 22 February (Argus) — Closing all Dutch coal-fired power stations would reduce emissions by 15mn t CO2 equivalent, although some of those emissions would be displaced to elsewhere in Europe, consultancy Ecofys said.

The Dutch lower house of parliament adopted a motion calling for the phase-out of coal-fired power plants in November, asking the government to draw up a plans. Some critics claimed that it will be ineffective in reducing emissions, because the nation will simply displace its emissions to neighbouring countries from which it imports power.

An Ecofys study confirmed this, but found that imported electricity would probably come from a less carbon-intensive energy mix and represent about 50pc of the emissions that would have been generated by coal-fired power, or 7.5mn allowances.

Critics of the plan claimed that the hard cap in the EU emissions trading scheme (ETS) means that cutting emissions in one country allows others more permits to pollute, a phenomenon the study described as "the waterbed effect". But this would be muted by the market stability reserve (MSR), according to the study — The waterbed effect and the EU ETS.

"The waterbed effect… does take place, but the MSR has a dampening effect over time and this effect is also subject to possible future political decisions about the surplus in the EU ETS," Ecofys said. Around 40pc of the allowances released into the system by closing Dutch coal plants would be absorbed by the MSR, the report said.

The effect would also be muted by the existing large surplus of unused allowances, which means that displaced emissions reductions are being added to an existing large oversupply. And allowances in the MSR could be cancelled in the future, making the emissions reductions they represent permanent, the report said.

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