Malta loses bid to raise CO2 limits

The European Commission has stood firm on its allocation of carbon dioxide emissions to Malta, despite attempts by the government to persuade it to raise the limit it had set for the island.

A source close to the Commission said yesterday the environment directorate general had reviewed the arguments submitted by Malta last February and decided not to alter its decision taken last year.

The Commission had decided to cap Malta's emissions at 2.1 million tonnes a year between 2008 and 2012, that is, 30 per cent below what Malta demanded.

"We responded to the submissions made by the government a few days ago. Despite the various technical arguments submitted by Malta to make us raise the island's allocation, we have decided to stick to our original position and not to give in to these demands. The arguments brought forward by the Maltese government where thus rejected by the Commission," the source said.

This decision being final, the government has only two possible options: Either to abide by the Commission's allocation decision or to challenge it in at the European Court of Justice (ECJ).

Government sources admitted that the decision is a "negative one as it can limit the expansion of the Maltese economy".

A decision has not yet been taken on whether to fight the Commission at the ECJ, the sources added.

As part of its obligations under the EU's emissions trading scheme, Malta presented its National Allocation Plan (NAP) to Brussels last year, requesting an allocation of 2.96 million tonnes of carbon dioxide emissions annually until 2012. After analysing the plan, Brussels turned down the request and set a limit on Malta's emissions of 2.1 million tonnes a year.

Only two local installations fall under the emissions trading scheme: The two power stations run by Enemalta. According to unpublished figures, in 2005 they generated 1.98 million tonnes of carbon dioxide, which is about seven tonnes per capita.

The government's claim for a bigger allocation of emissions was primarily based on the assumption of an increase in energy demand in the coming years due to more economic activity. The government's claim also included a "reserve allocation" in case of a new entrant into the market, such as a new installation.

Malta has already joined a court action over the issue initiated by Slovakia as some of Slovakia's arguments are similar to Malta's.

Latvia, Poland, Hungary, the Czech Republic and Estonia have also gone to the ECJ over the issue and Lithuania recently announced it will be making a similar challenge.