French ETS installations face CO2 tax until 2013

French ETS installations face CO2 tax until 2013

Following the decision of December 29th 2009 by the French constitutional court on the Finance Act 2010, the French industrial installations that are covered by the EU’s emission trading scheme (ETS) will have to pay a tax on CO2 until 1 January 2013. Initially, the carbon tax was only intended for the sectors outside the ETS but the court ruled that this was unfair because too many ETS installations were given free CO2 allowance based on exemptions. Specific measures will apply to the energy-intensive ETS sectors such as steel and cement as well as to energy-intensive sectors outside the ETS e.g. agriculture and transport in order to preserve the competitiveness of the French companies. Furthermore, based on the report of the Council of Ministers of January 20th, France is pushing for the establishment of a European contribution to carbon tax in order to establish a fair competitive environment.