Carbon leakage in the nitrogen fertilizer industry

Going forward, the ETS will – and should – be strengthened as the main climate policy instrument in the EU. At the same time, dealing effectively with carbon leakage becomes tantamount in order to achieve an effective ETS that truly reduces global greenhouse gas emissions, and not just relocates emissions and production to countries with less ambitious climate policies.

While there have been many positive signals in analyses done by the Commission, the proposed revision of the ETS risks not providing adequate compensation for the industries at the highest risk of carbon leakage, such as the fertilizer industry.

The main conclusions of our study are

 The study is commissioned by Fertilizers Europe

I am impressed by Copenhagen Economics’ professional competence and ability to identify the key issues for our industry. They provided us outstanding insight into the underlying economic mechanisms and delivered an excellent presentation of the main results of the study at the European Parliament.
Dr. Antoine Hoxha - Technical Director, Fertilizers Europe