20 October 2008 00:00 [Source: ICB]
Euro Chlor, the trade group representing chlor-alkali producers in Europe, says there is a danger the industry may choose to invest elsewhere if concessions are not made towards heavy power users
DECISION MAY FORCE CHLORINE INDUSTRY OUT OF EUROPE
The European Parliament's vote on the Emissions Trading Scheme (ETS) is a disappointment to the European chlor-alkali industry. If this electricity-intensive industry, on which many other industrial activities so largely depend, will not be allocated free carbon dioxide (CO2) allowances, its competitiveness on global markets and its overall future are endangered. It wants to operate on equal terms with other heavy power users.
If in Europe our sector had to absorb the extra carbon costs passed on by the power producers, we would be forced to consider new investments elsewhere. That is why the federation has been advocating an allocation of free CO2 allowances, based on performance related benchmarks.
This has, to a certain extent, been recognized in some quarters. In the current proposal, however, none of these measures will be applicable to chlor-alkali.
Our industry finds itself in a particular situation, because as an electricity consumer, it is not a direct emitter of CO2. Electricity accounts for about 50% of production costs. This makes the sector particularly vulnerable to higher electricity prices, so there is an urgent need for the proposal to be amended.
In order to develop medium and long-term investment plans, the sector needs certainty on the criteria to determine which sectors are exposed to international competition and may inevitably be subject to "carbon leakage."
The vote misses an opportunity to create clarity for electricity-intensive industries and to help preserve the basis of European economic and social stability and growth, thereby maintaining the competitiveness of its industry and the large number of jobs it provides.
The chlor-alkali industry, together with the whole of the chemical industry, shares Europe's determination to tackle climate change. It has been achieving greater energy efficiency for many years and provides chemical building blocks for other industries to reduce carbon emissions.
Executive director, Euro Chlor
WORK WITH ECHA TO MAKE REACH WORK
We at FECC have been following, with great concern, developments in the preregistration phase on the Reach regulation. We do not recommend our members - or any other parts of the chemical industry - to preregister the entire European Commission inventory as this is most unhelpful to the smooth running of Reach implementation.
Our members are committed to the proper implementation of Reach. We will always be prepared to work in a constructive manner with the European Chemical Agency (ECHA).
Director General, FECC
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