Allocation free emission allowances

How will free emission allowances be allocated?
The directive stipulates that in the first trading period - from 1 January 2012 up to and including 31 December 2012 - the total quantity of allocable emission allowances will equal 97% of historical aviation emissions. For the second period that starts on 1 January 2013, this quantity will be equal to 95% of historical aviation emissions. The European Commission will set the historical aviation emissions six months after the directive comes into force, based on the emissions in the years 2004, 2005 and 2006.

Most allocable emission allowances will be allocated free of charge and some will be auctioned. The directive states that the European Commission will finalise the following not later than 30 September 2011:

• the total quantity of allocable emission allowances available;
• the quantity of emission allowances that will be auctioned (this concerns 15%);
• the quantity of emission allowances in the special reserve for newcomers and additions (this concerns 3% for the period starting 1 January 2013);
• the quantity of emission allowances to be allocated free of charge.

The allocable free emission allowances will be divided over participating operators based on their transportation performance in 2010 in terms of tonne-kilometres. A tonne-kilometre is a uniform measure for transportation performance and corresponds with the transport of one tonne of goods or passengers over a distance of one kilometre.

Based on the number of tonne-kilometres of all participating operators and the available quantity of freely allocable emission allowances, the European Commission will set a benchmark on 30 September 2011 for calculating the individual allocation to each participating operator. (The benchmark is expressed in the number of emission allowances per tonne-kilometre.) Using the benchmark and the tonne-kilometre data supplied by the operator for 2010, NEa will calculate and publish the quantity of free emission allowances allocated to each operator not later than 31 December 2011. In other words, the benchmark plus the reported quantity of tonne-kilometres for 2010 will determine the quantity of free emission allowances that will be allocated to an individual operator. Allocated emission allowances will be credited each year to the account in the register.

How do you apply for free emission allowances?
An operator may apply to the Dutch Emissions Authority (NEa) to be allocated free emission allowances. The application must be submitted not later than 31 March 2011 both for the first trading period (2012) and for the second trading period (2013 up to and including 2020). Applications must be submitted by providing NEa with verified tonne-kilometre data of the flights operated in 2010. Consequently, applications for free emission allowances may be made only if the 2010 tonne-kilometre data have been monitored and the tonne-kilometre report has been verified by an independent verifier.