EU companies struggling to adapt to emissions trading scheme
A pan-European survey has found that half of the major EU companies are not yet ready to comply with the EU's Emissions Trading Scheme (ETS) regulations, the deadline for which is 1 January 2005. The survey, which was carried out by LogicaCMG in the UK, the Netherlands, Germany, Belgium, Italy, Spain and France, surveyed 250 senior executives across industries covering power generation, refineries, cement and steel, paper and pulp, heavy industry and automotive sectors. The ETS will impose prescribed targets for reducing CO2 emissions on companies in those sectors. Companies can choose whether to reduce emissions or purchase extra allowances. Those not prepared, warns the report, could face heavy fines. Indeed, at 40 euro per tonne of unauthorised CO2 emissions, penalties for large emitters could run into hundred of millions of euro. 'Assuming January 2005 is the start date, only half of companies will be ready. Significantly fewer than this in the iron and steel, paper and pulp and automotive sectors will be in a position to meet the needs of the ETS. Overall, only one third of major companies in Europe are ready now, leaving most with much to do over the next few months,' states the report. It adds that there is a 'significant lack of in-depth knowledge for a scheme with such far reaching impact, just a few months away from its intended start date.' The survey also warns that those companies that have not made much progress towards compliance could face a consumer backlash. Indeed one in three consumers say they will switch brand allegiance on environmental grounds if a company they regularly buy goods and services from fails to comply. 'Our study shows that both consumers and industry are in favour of the reduction of carbon emissions and consumers are prepared to pay a premium for environmentally friendly goods and services,' explained Jim Yeats, managing director of energy and utilities at LogicaCMG. 'Unfortunately it is apparent that most companies have not made much progress towards compliance [...] and they will suffer the consequences - not just in terms of fines but in something less tangible, but ultimately more valuable-customer loyalty.'
Countries
Belgium, Germany, Spain, France, Italy, Netherlands, United Kingdom