Recent reforms of the EU's emissions trading scheme has changed the conditions for Vattenfall's decision to bring forward the closure of the Ringhals 1 and 2. Previously, the system had a fixed ceiling for the total carbon dioxide emissions, which meant that the decision would not have affected the emissions. This no longer applies.
About Vattenfall's decision leads to the increased production in the fossildrivna power plant in our neighborhood will ets total emissions to increase. The sooner the reactors are closed the greater this impact. The effect has no price tag and therefore ignored by the Vattenfall business assessment. The choice of time for the closure of the Ringhals 1 and 2, therefore, requires a broader perspective.
Much of the recent debate on the role of nuclear power has been about the conditions for and policy impact of new nuclear power in Sweden. We want to point to a different climate science and policy aspect, namely that the later years of reform of the EU emissions trading system (EU ETS) has meant that even the timing of the phasing-out of Swedish nuclear power production has importance for how large the emissions from the ets becomes.
According to the Waterfall, a decision was taken on commercial grounds. At this point in time were the rules for emissions trading, such that a certain amount of allowances would be available for businesses to use. To any actor in the system increased their emissions meant that utsläppsutrymmet for other players contracted in a corresponding degree. The system's total emissions were not affected. It was therefore with a business assessment from the Waterfall.
If the allowances will be cancelled for each year until 2038, the effect can be counted in tens of millions of tonnes of carbon dioxide.
the 2008 financial Crisis, and then a weaker economic growth than expected, combined with an unchanged supply of allowances contributed to the emission allowance price during the long period of time was very low, and that companies in the EU emissions trading system been able to save a large number of allowances. The development was considered to be incompatible with the EU's long term climate target why recently, the system was reformed.
The most important part of this reform is a faster reduction of the number of allowances that are annually added to the system, a decision that reduces the future emissions of just under 9 billion tonnes of carbon dioxide (about twice the EU's annual emissions). Thus, no more allowances will be allocated after 2057. The other two parts of the reform is the introduction of a so-called marknadsstabilitetsreserv and a mechanism which, under certain conditions automatically revokes (cancels) allowances.
as Of 2019 as long as there are more than a certain number of allowances in circulation, a proportion of the allowances that were supposed to be auctioned to instead be transferred to the marknadsstabilitetsreserven. The idea is to get businesses to a greater extent, using the saved emission allowances. Starting in 2023, will reserve compared with auktionsvolymen the previous year, and if the former is larger so cancelled the difference. A large amount of additional allowances is therefore expected to disappear, see the national institute of economic Research (2018).
the r, something that has already affected the emission allowance price. Since the summer of 2017, the price has increased more than fivefold, and currently stands at over 26 million.
Annulleringsmekanismen also opens up new opportunities for a country to affect the total emissions from the eu ets. A policy that, for example, increasing the Swedish net exports of electricity and thus displace fossil-based electricity generation in our neighbouring countries now leads to that more emission allowances are transferred to the reserve and thus may be subject to cancellation. The result is, in the end, that the number of allowances over time available decreases. The opposite effect can be obtained by a policy or action that reduces the Swedish net exports of electricity, for example, a closure of Swedish nuclear power plants.
, including the carbon intensity of the plants that increase their output and how quickly the trading system in balance. When this happens, perform the system, as the old ets.
thus, It is difficult to calculate the effect, but the following calculation may be illustrative. The closure of the Ringhals 1 and 2 means that approximately 13 TWh of Swedish carbon-free electricity generation falls away. Suppose that the coal-based electricity generation in our environment this increases by 6.5 TWh. This would increase the annual emissions by around 6 million tonnes of carbon dioxide. If it just becomes a annulleringsomgång (2023), can the acceleration of the closure of the Ringhals 1 and 2 are expected to increase the accumulated emissions by nearly 8 million tonnes. This corresponds to almost half of the annual emissions from our domestic transport. With high probability it will, however, more annulleringsomgångar. Then the impact will be greater. If the allowances will be cancelled for each year until 2038, the effect can be counted in tens of millions of tonnes of carbon dioxide.
The previous closing takes place and the production is increasing in our neighbouring countries, the fewer the allowances can be transferred to the reserve and subsequently cancelled.
This increase of emissions have no price tag and be considered not by the Vattenfall business assessments. The question thus need to be considered in a broader perspective and be lifted to the politicians.