Conference of Parties (COP)
The COP21 meeting which took place in Paris end November till early December 2015, was aimed at reaching a global climate agreement.
The United Nations’ meeting has been held in Paris from 30 November to 12 December 2015. One day after the official deadline the 196 countries present at the conference have been able to find an agreement aiming at limiting global warming to “well below 2℃ above pre-industrial levels and to pursue efforts to limit the temperature increase to 1.5℃”. EU leadership helped to overcome substantial diversity in interests and views among countries participating in the UN’s COP21 meeting in Paris in 2015. As a result, the conference agreed an ambitious target to limit global temperature rises and a binding commitment to submit national plans for ever-greater reductions in greenhouse gas emissions. From now, the EU refining industry needs a framework in which it can show how to satisfy the growing global demand for energy while at the same time limiting GHG emissions. This is one of the most critical challenges of our time,
The EU negotiators’ team should be commended for their efforts to help other countries developing comparable regulatory tools. Further efforts will be needed to ensure that this will lead to effective global action and equitable commitments from all parties of the agreement, leading in turn to the establishment of a competitive level playing field among world economies.
FuelsEurope supports international efforts to address the risks of climate change and European refiners are uniquely qualified to contribute. However, they can only do so on a competitive level playing field.
Maintaining Refining operations in the EU will contribute to reduce GHG emissions
The best way to minimise global GHG emissions, given the continuing need for oil products in Europe, is to manufacture them in the EU. By contrast, an increasing dependency of EU consumers on non-EU refineries implies a weakening of the efforts to reduce global warming. So it is essential that EU energy and environment policies be considered in a global context. If regulations continue to force up the relative cost of refining oil in the EU, European refiners could lose further market share. The result would be more imports of refined products, meaning that a greater proportion would be produced in facilities that are less energy-efficient that those in the EU. This would constitute carbon leakage and defeat the purpose of the EU regulations.
FuelsEurope therefore calls for efforts to ensure that the COP21 agreement will lead to equitable commitments from all parties to the agreement and a level playing field for the industry worldwide. Revenue-neutral market-based mechanisms, including carbon pricing under the right circumstances, are a more economically efficient way to drive the reduction of GHG emissions than industry-specific regulation, technology mandates or performance standards. There should also be a universal regime for monitoring, reporting and verification. Until the main economies have effectively engaged in similar climate policies to the EU, carbon leakage protection should be introduced to help EU industries that are exposed to unbalanced international competition.