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I'm not sure if I got the EU-ETS system for trading emission rights right. I think there is a limited amount of certificates issues by each country each year. The amount that is allowed to be issued is set by the EU, right? Each certificate allows a company to emit 1000 kg of CO2 (or an equivalent for other gases).

So how many will be issued for Germany in 2021?

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    You seem to be asking a different question in the body then the title as well as multiple questions.
    – Joe W
    Sep 26 at 15:21
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    I've removed the additional question, but I don't understand what you mean by "multiple questions". The EU-ETS cap is the amount of issued certificates. Sep 27 at 5:13
  • Well you originally asked about 2021 in the title and multiple years in the question. And it is just a bit confusing to see you word it differently in both places asking how high in the title and how many in the body.
    – Joe W
    Sep 27 at 12:42
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    @JoeW I guess people who can answer this question don't find it confusing. Using both terms makes it easier for people to find the question via search engine. Sep 27 at 13:06
  • (+1) The system is quite complicated and certainly worthy of a question on this site.
    – Relaxed
    Sep 27 at 16:25
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The EU Commission published a handbook detailing how the system works. I cannot say that I am confident that I fully understand it but the process is quite a bit more involved than simply a top-down allocation of a total number of certificates.

Instead, a number of certificates is computed for each “installation” (industrial site, power plant, etc.) based on historical activity levels and a technology benchmark. Then these numbers are aggregated, some certificates are set aside for new entrants, member states with low income, and member states that already reduced emissions by 2005 and a reduction coefficient is applied each year. Each member state gets to allocate the certificates that are left through two different mechanisms (free allocation directly to existing installations and auction). On top of that, there is an entirely separate system for the aviation sector.

The rules for computation are defined by EU law and the EU Commission has a role throughout the process but the member states are in charge of measurement and computation. The Commission reviews and approves the member states' submissions but does not exactly issue or allocate certificates. The list for Germany is available here.

Importantly, certificates that get auctioned can be bought by businesses anywhere in the countries participating in the system (and not only by those based in the member states organising the auction) so they do not necessarily cover the originating country's emissions. Since the relevant member state gets to keep the revenue, it still makes sense to ask how many certificates they were issued in the first place, though.

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