The European Commission started legal action against eight European Union states on Thursday for failing to submit plans that allocate how much carbon dioxide (CO2) their industries may emit in 2008-2012. The plans are the cornerstone of the EUs emissions trading system, which sets limits on the amount of CO2 big factories can release and enables them to buy or sell permits to pollute. The plans for the 2008-2012 period were due to the EU executive by the end of June, but most states were late. The Commission said on Thursday it was starting legal action -- in the form of a warning letter -- against Austria, the Czech Republic, Denmark, Hungary, Italy, Portugal, Slovenia and Spain for failing to turn in their plans. "I expect the member states concerned will submit their second phase national allocation plans and the other missing information as soon as possible," Environment Commissioner Stavros Dimas said in a statement.

"To give certainty to the emissions trading market it is important that the national allocation processes are finalised well before the start of the next trading period beginning in January 2008." The first phase of the landmark scheme runs from 2005-2007. The Commission, which can approve or reject the plans, is under pressure from environmentalists to insist on strict cuts after data for the first year of the system showed most companies had more credits than they needed, leading to a carbon price crash.

The EU s scheme is its key instrument to fight climate change and meet commitments under the Kyoto Protocol. The Commission also said on Thursday it was taking Luxembourg to the European Court of Justice "for not providing sufficient information on its policies and measures to reduce greenhouse gas emissions and on its projected future emissions." It said it was also sending separate warnings to seven states "for not communicating important technical information relating to their emission targets".
(Planet Ark, 13/10/2006)