Climate of Cooperation

The report evaluates the Effort Sharing Regulation (ESR), concluding that its -30% target for non-ETS sectors is insufficient to meet Paris Agreement goals and may only result in a 26.6% reduction due to flexibilities. It advocates for project-based transfers of Annual Emission Allocations (AEAs) to ensure additionality and avoid carbon lock-in in lower-income Member States. Specific opportunities for such projects are identified in the building, waste, and gas sectors of Bulgaria, Romania, and Hungary.

• The ESR's -30% target for non-ETS sectors is insufficient for the EU's long-term goals; a target of at least -40% by 2030 is required to align with the upper range of the 80% to 95% reduction targets for 2050 and the Paris Agreement.
• Due to available flexibilities, the ESR may only require Member States to reduce non-ETS emissions by 26.6% by 2030, potentially causing the EU to miss its overall -40% reduction target.
• The overall additional reduction effort required by the ESR for the EU28 between 2021 and 2030 is estimated at 141 Mt CO2eq., which averages to 14 Mt CO2eq. per year, or approximately 0.5% of 2005 emissions.
• Project-based cooperation is the only flexibility mechanism that guarantees additional reductions in non-ETS sectors, whereas external flexibilities (EU ETS and LULUCF) and simple AEA transfers do not ensure additionality or permanence.
• Demand for AEA transfers is expected to come primarily from smaller, higher-income Member States, with estimated cumulative demand ranging from 75 million to 644 million AEAs depending on the scenario.
• Potential supply of AEAs could reach 614 million if lower-income countries unlock further reductions through projects, compared to only 96 million under a business-as-usual (WEM) scenario.
• In Bulgaria, Romania, and Hungary, significant emission reduction potential exists in the building sector through energy efficiency improvements to combat energy poverty and avoid fossil fuel lock-in.
• The waste sector in Bulgaria, Romania, and Hungary offers reduction opportunities by phasing out landfilling and recovering methane emissions, helping these states comply with the EU Landfill Directive.
• Romania has a specific opportunity to reduce fugitive methane emissions in its gas sector, as its methane emission rate (1.2%) is significantly higher than the EU average (0.2%) and the rate in the Netherlands.
• The ESR's Safety Reserve, which can be as high as 105 million AEAs, risks undermining reduction incentives for lower-income states because a second distribution round may concentrate the reserve among only four countries: Italy, Poland, Slovakia, and Cyprus.

APA

Ember (n.d.). Climate of Cooperation. https://ember-energy.org/app/uploads/2024/12/Climate-of-Cooperation-ESR-report-Sandbag-March-2018.pdf

Chicago

Ember. Climate of Cooperation. n.d. https://ember-energy.org/app/uploads/2024/12/Climate-of-Cooperation-ESR-report-Sandbag-March-2018.pdf.

Wikipedia

{{cite report |author=Ember |title=Climate of Cooperation |url=https://ember-energy.org/app/uploads/2024/12/Climate-of-Cooperation-ESR-report-Sandbag-March-2018.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{emberndclimate, author = {{Ember}}, title = {{Climate of Cooperation}}, institution = {Ember}, url = {https://ember-energy.org/app/uploads/2024/12/Climate-of-Cooperation-ESR-report-Sandbag-March-2018.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }