Ceramic industry statement against tiering of EU ETS carbon leakage list

The European ceramic industry is gravely concerned about the proposed “tiered” approach to free allocation for industries at risk of carbon leakage, as recently presented in a joint France-UK non-paper. In response, Cerame-Unie (of which TBE is a member) has published a statement highlighting the risks of pursuing a tiered approach.

The review of the EU ETS Directive is of critical importance to the ceramic sectors, as the scheme covers more than 1,200 ceramic installations across Europe, representing 10% of the total number of ETS installations, but less than 1% of EU ETS industrial emissions. The ceramic industry, which is present in all EU Member States, is largely composed of SMEs (80%) and provides around 200,000 direct jobs across Europe. At present, all ceramic sectors within ETS (namely manufacturers of: bricks, roof tiles and clay pipes, wall and floor tiles, refractories, sanitaryware and other ceramic products) are deemed to be at significant risk of carbon leakage.

The introduction of any “tiered” approach would result in incomplete mitigation and hence significantly increased risks of carbon, investment and jobs leakage. 

Under the “tiering” proposals outlined in the France-UK non-paper, all ceramic sectors would see an enormous reduction in the level of free allocation received. Some ceramic sectors might receive mitigation from 30% up to 75% of a tougher benchmark (based on the average of the 10% most carbon-efficient sites), whereas other sectors would receive just 30% of the stiffer benchmark at the start of the phase, dwindling to 0% by 2027. Furthermore, the introduction of a “tiered” list would provide major distortions globally against non-EU ceramic producers and in the internal EU market (with competitor products from other industrial sectors in higher tiers). This makes investment in the EU very challenging indeed and undermines the feasibility of existing operations. All of which is set against a backdrop of significant investments taking place in neighbouring countries outside the EU.

The tiered approach to free allowance allocation for the EU ETS carbon leakage list is a concept which undermines the aim of the EU ETS and contradicts the October 2014 European Council Conclusions. It would not ensure the delivery of cost-effective greenhouse gas emission reductions, but on the contrary would have a deleterious impact on the wider European economy and would result in an increase in global emissions. A tiered approach would result in an inadequate level of carbon leakage protection for all ceramic sectors.

It is crucial that all ceramic sectors and subsectors receive full carbon leakage protection. We support the two-tier proposal as presented by the European Commission, which grants 100% free allocation to sectors on the carbon leakage list, providing that the option of a qualitative assessment of leakage risks is available to all sectors irrespective of the quantitative assessment outcome (i.e. the threshold of 0.18 should be removed).

What is Building Information Modelling?

The latest buzzword, fad or serious issue, depending on your viewpoint in the construction sector is Building Information Modelling (BIM). Just what BIM is and what it means to manufacturers is anything but clear.

In essence BIM is simply the means by which everyone can understand a building through the use of a digital model. The digital model can be made up of 3D drawing models (in various levels of detail) and probably more importantly a collection of product-specific meta data (usually in the form of a product data template (PDT)) that help to present the characteristics of a product in a standardised form.

The largest problem facing manufacturers with this concept is that there is not a single agreed method of providing BIM data to architects, specifiers and contractors. In fact there are a number of ‘closed’ BIM systems that manufacturers may embrace just to be able to have the opportunity to tender for work.

CEN has recently started a new Technical Committee (TC442) to start to standardise BIM within Europe. However, the real work within TC442 has yet to start. There have only been two meetings to date with the last meeting taking place in Oslo on 15 and 16 February 2016.

The primary decision of TC442 is to agree that the existing ISO standards for BIM will be adopted as European Standards. Secondly the TC442 have set up a number of working groups to take responsibility for the different aspects of BIM:

  • WG1 Strategy and planning (secretariat: United Kingdom)
  • WG2 Exchange information (secretariat: Germany)
  • WG3 Information delivery specification (secretariat: Austria)
  • WG4 Data dictionary (secretariat: France)

There is also a newly appointed Chair Advisory Group (CAG) that will work to make sure that each WG remains focused on their core activity.

Most importantly, the adoption of ISO BIM standards mean that the European Standards will embrace ‘open’ BIM standards. Hopefully this will ensure that future BIM will be appropriate, transparent and cost effective for all interested parties from the designer right through to the manufacturer.

Thanks to Christian Taylor-Hamlin, Technical Director at Bathroom Manufacturers Association, for submitting this article.

EU Environment Council follows up on COP21

On 4 March the EU Environment Council met in Brussels to debate the follow up of the Paris agreement.

The Ministers agreed that it is necessary to “keep the Paris momentum alive and to turn the focus to the implementation of commitments”. Many Members States identified swift ratification of the agreement as a priority. Environment Ministers welcomed the European Commission’s assessment of the Paris agreement and implications for the EU 2030 climate and energy policy.

Visit the Council website for more information.

MEP Belder visits Dutch brick plant

On 4 March, MEP Bas Belder (Netherlands, ECR) met the Royal Dutch Association for Building Ceramics (KNB) and visited brick manufacturer Rodruza De Zandberg in Gendt. The Director of Rodruza Ivo Würzner, KNB Chair Dick Tommel and KNB Director Ewald van Hal extended a warm welcome to MEP Belder and his assistants.

In addition to a tour of the plant, the visit provided an opportunity to discuss crucial issues for the Dutch brick industry. MEP Belder acknowledged the importance of a level playing field, particularly in relation to China’s Market Economy Status, which the EU is currently debating granting at the end of 2016. However, as China does not meet the criteria to be considered a market economy, granting it prematurely poses a significant threat to European industry.

Other relevant topics addressed at the meeting were the post-2020 EU Emissions Trading Scheme review, the fitness check on Natura 2000 and the Directive on Dangerous Substances.

EU Competitiveness Council conclusions

In its conclusions from 29 February, the EU Competitiveness Council re-stated the need for “a balanced and comprehensive approach to assist energy-intensive industries in modernising, innovating and adjusting to long-term changes in global value chains and market trends, which should aim at creating a business environment enabling EU industry to compete on global markets”.

They also took note of the messages from the Conference on Energy-intensive Industries on 15 February, including reducing regulatory and ETS-related costs on industries facing the strongest international competition.

See more information about the Council meeting here.

MEP Proust visits French roof tile company

On 10 February 2016, French MEP Franck Proust met with Cerame-Unie, the umbrella organisation of which TBE is a member, and the French Federation of Roof Tiles & Bricks member Terreal in Ségala, France.

The meeting included a visit of the Terreal tiles plant where Mr Proust learned about tiles production and innovation in terms of energy efficiency in the context of Terreal’s Heart project financed by the Life+ programme. Moreover, Terreal exchanged views with Mr Proust, a member of INTA Committee, on important issues for the ceramics industry such as energy efficiency, Emissions Trading Scheme (ETS), competitiveness and China’s market economy status (MES).

Reply to Energy Efficiency Directive public consultation

As a member of European ceramic industry association Cerame-Unie, TBE's messages were conveyed in the response to the public consultations on the post 2020 Energy Efficiency Directive (EED) revision.

The ceramic industry stated: “There shall be no overlap between the different instruments to reach targets of the 2030 Climate and Energy Framework. The EED and ETS Directive should not interfere with one another, not to create over-excessive burdens for industry. (...) Sectors under the scope of EU ETS should not be subjected to requirements under the EED”.

The EED is to be reviewed within the framework of Energy Union and a legislative proposal is expected to be presented by the European Commission in the second half of 2016. Cerame-Unie's reply can be read here.

REACH Authorisation Annex XIV - Process ongoing

Refractory Ceramic Fibres, Borates and Coal tar pitch, high temperature are listed in the 5th and 6th ECHA recommendations for substances to be included in the REACH Authorisation list (Annex XIV). The REACH Committee meeting on 21-22 October 2015 launched the discussions on their possible inclusion in the Annex XIV.

As these substances are of utmost importance to ceramic industries and their downstream users, Cerame-Unie maintains that there are socio-economic implications related to a possible inclusion. As a member of the Cross-Industry Initiative (CII), CU supports the proposal to consider workplace legislation as an alternative to REACH Authorisation. Kai Sebastien Melzer, Regulatory Affairs Manager at the Nickel Institute, spoke on this subject at the CU General Assembly on 1 December 2015.

The process is still ongoing but the REACH Committee should come to a decision in the first half of 2016.

EU ETS Directive review impacts ceramic industry

The impact of the EU ETS Directive review plays a crucial role in ceramic sectors’ recovery from the crisis, which hit Europe in 2008. Many ceramic sectors – namely ceramic tiles, bricks and pipes, refractories, and sanitaryware – are at risk of production, jobs and investment relocation to other globally competing economies. Their international competitiveness would be hampered if the carbon leakage risks are not mitigated. Furthermore, if such leakage occurred, it would increase the global carbon footprint. This is why the retention of 100% carbon leakage status for best performers after 2020 is a business critical issue for those ceramic sectors. The European Commission proposes to maintain the carbon leakage measures and grant 100% free allocation at the level of reviewed benchmarks to all sectors deemed at the carbon leakage risk in the period 2021-2030.

Introduction of any kind of differentiation on the carbon leakage list, as advocated by some Member States, leads to incomplete carbon leakage protection and consequently to a distortion of the level playing field both with EU and international competitors. Moreover, there is a need for increased legal certainty to unleash the long-term investment perspectives, in particular in such ceramic sectors as bricks and roof tiles.

On 25 January ceramic industry representatives highlighted their concerns with regards to the impact of the EU ETS Directive review for ‘phase four’ during an MEP’s visit to a UK-based brickwork. MEP Ian Duncan, the rapporteur on this file, attended the meeting organised by the British Ceramic Confederation (BCC). His visit was reported in local newspaper The Sentinel.

Next steps

After the legislative proposal was published by the European Commission on 15 July, the discussions started in the Council during the October meeting of the Environment Ministers. Similarly, the topic will soon enter the European Parliament’s agenda. Negotiations are expected to take place until at least mid-2017.

Further reading

Under Cerame-Unie, TBE published a position paper on the Post 2020 EU ETS Review, in particular the carbon leakage risk assessment, as well as other elements of the EC proposal.

MEP Ian Duncan with BCC Chief Executive Laura Cohen and TBE Secretary General Magdalena Vallebona

MEP Ian Duncan with BCC Chief Executive Laura Cohen and TBE Secretary General Magdalena Vallebona