You Can’t Outrun Your Shadows

An unorthodox approach to reforming one of the EU's key climate change policies


If two years of legislating in the European Parliament has taught me anything it is that no matter how hard you try, you can’t outrun your shadows.  I can’t quantify the hours I have lost (or indeed the ennui I have endured) in meetings where a rapporteur has tried and failed to find a compromise between his political view and that of his shadow rapporteurs; some call it politics, I call it a waste of time.


As the rapporteur of one of the European Parliaments’ most controversial files, the Emissions Trading System (ETS), I have tried to do things differently.  Before putting pen to paper my shadows and I have sat together to explore, examine and extrapolate the ETS to find out what the reforms mean for our climate change ambitions, for our industries and for the faltering price of carbon. Over the past four months me and my shadows have met industry experts, Member State Governments, NGOs and European Commission officials in a series of ‘informals’ with the hope of better understanding the mechanics of reform and, crucially, where we as representatives of our political groups actually stand on the issues.  What I hope has emerged is a better understanding of what is at stake, where the political tensions lie and where consensus and compromise can be found.

The EU-ETS aims to reduce carbon emissions by compelling those who create emissions to pay for every tonne of CO2 they to emit through the purchase of an allowance. If an emitter can reduce emissions by innovation, costs are reduced. Capping available ‘allowances’ and reducing the cap year-on-year drives emission reduction. A simple concept, a hard reality, particularly where there is a risk that industries will relocate beyond the reach of EU rules, termed ‘carbon leakage’ To guard against this flight, a number of allowances are awarded free. Deciding how many and to whom is a hot topic. Some claim industry needs none; innovate or die. Others believe that the Commission proposal of 43% free allowances is not generous enough. Member States also have a vested interest, since the allowances not awarded free are auctioned and the monies banked the national government. You can see why this could get messy.


As a member of the ECR Group I recognise that my strength as the Parliament’s lead negotiator does not come from the size of my Group but rather from my ability to broker a deal (both in the ENVI committee and later in plenary) between groups bigger than my own. In truth, even my shadows from the bigger groups – the S&D and EPP – don’t command unity of opinion (or indeed majority opinion) within their groups. Often national governments and national interests are foremost, rather than an esprit d’Europe. That is why last Tuesday I published an options paper and sent it to my shadows.  That paper draws upon the meetings we have taken together over the past few months and sets out a suite of choices on the twelve key areas of the ETS proposal, from post-Paris ambition levels to the carbon leakage provisions and everything in between.


The aim of the paper is twofold, first to ascertain the preferences of shadows and their groups on the key issues at stake, and secondly, in the by-going, to try and ensure that what emerges from Parliament is a coherent, cogent and logical position. From the get-go I have argued that we must balance our ambitious climate change targets with serious protection of industry from carbon leakage. However, this can only be achieved if what eventually emerges from the legislative sausage machine actually hangs together.


I asked my shadows to set out their preferred options by the 6th of May (coincidentally the day after the Scottish elections). Now I have the responses, the drafting of the report should be a piece of cake! My report is due to be with the translators on the 20th of May, so I have less than a fortnight to pull it all together. I am hopeful that the report that emerges will be balanced, ambitious and able to afford protection to industry.