Carbon Fat Cats 2011

The report identifies the 'Carbon Fat Cats'—ten companies, primarily in the steel and cement sectors, that amassed a combined surplus of 240 million emissions allowances between 2008 and 2010, valued at approximately €4.1bn. This over-allocation is attributed to inflated growth projections and the economic recession, allowing these firms to profit through windfall sales or banking permits for future use. In contrast, the power sector faces a significant deficit, effectively subsidising industrial surpluses. The report also highlights the use of cheap international offsets, some from direct rivals in China and India, which undermines industry claims regarding competitiveness and carbon leakage. Sandbag recommends increasing the EU emissions reduction target to 30%, implementing an allowance 'set-aside' for Phase III, restricting the use of offsets from rival industries, and improving data transparency regarding company ownership and waste gas transfers.

• Ten companies, termed 'Carbon Fat Cats', held a combined surplus of 240 million allowances between 2008 and 2010, with a market value of approximately €4.1bn. This surplus is projected to grow to 330 million allowances by the end of Phase II, valued at €5.6bn.
• The iron and steel and cement sectors have the largest surpluses of permits. The top ten emitting iron and steel companies hold a surplus of 172 million allowances (worth €2.9bn), while the top ten cement companies hold 90 million (worth €1.5bn).
• The power sector acts as the primary buyer in the EU ETS due to a permit deficit of 214 million. This creates a situation where EU citizens may be unwittingly subsidising oversupplied industrial sectors that sell surpluses without reducing emissions.
• Companies have used international offsets to meet compliance targets despite having surpluses. The 'Carbon Fat Cats' surrendered 24.4 million international credits valued at €315m, with 73% originating from China and India. Notably, €7m was spent on credits from direct international rivals, contradicting industry claims that such competition threatens their viability.
• The over-allocation of allowances was driven by inflated growth projections in National Allocation Plans (NAPs), particularly in Italy and Poland, and the subsequent impact of the economic recession.
• Significant data gaps hinder the assessment of the ETS, specifically the lack of mandatory parent company ownership data for installations and the absence of public data on calorific waste gas transfers between steel and power plants.
• The report recommends that Europe move to a 30% emissions reduction target and implement an allowance 'set-aside' in Phase III to address the oversupply and prevent a price crash.

APA

Elsworth, R., Worthington, B., Buick, M., & Craston, P. (2011). Carbon Fat Cats 2011. Ember. https://ember-energy.org/app/uploads/2020/03/Carbon-Fat-Cats-2011.pdf

Chicago

Elsworth, Rob, Bryony Worthington, Michael Buick, and Patrick Craston. Carbon Fat Cats 2011. Ember, 2011. https://ember-energy.org/app/uploads/2020/03/Carbon-Fat-Cats-2011.pdf.

Wikipedia

{{cite report |last1=Elsworth |first1=Rob |last2=Worthington |first2=Bryony |last3=Buick |first3=Michael |last4=Craston |first4=Patrick |title=Carbon Fat Cats 2011 |publisher=Ember |date=June 2011 |url=https://ember-energy.org/app/uploads/2020/03/Carbon-Fat-Cats-2011.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{elsworth2011carbon, author = {Elsworth, Rob and Worthington, Bryony and Buick, Michael and Craston, Patrick}, title = {{Carbon Fat Cats 2011}}, institution = {Ember}, year = {2011}, month = jun, url = {https://ember-energy.org/app/uploads/2020/03/Carbon-Fat-Cats-2011.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }