Every year, in accordance with the rules of the EU Emissions Trading Scheme, you as a plant operator must surrender allowances to the German Emissions Trading Authority (DEHSt) by 30.04 of each year, corresponding to the amount of CO2 emissions you emitted in the previous year and recorded in your emissions report in your registry account. Each certificate entitles you to emit one tonne of CO2.
For each certificate not surrendered by 30 April, you will be fined 100 euros as an affected company in the mandatory EU emissions trading scheme. Of course, you are still obliged to surrender the missing allowances by a date specified in the penalty notice. The penalty of 100 euros per tonne of CO2 also applies if, after submitting your emissions report - which will be checked in detail by the DEHSt within 5 years - errors are discovered that result in a higher quantity of emissions than initially stated.
Since an omission such as the untimely or incomplete surrender of emission allowances can cost several hundred thousand euros, the registry account management for companies provided for in EU emissions trading must be carried out with the utmost care.
What exactly is the problem?
The fact that the EUA allowances have to be submitted in the registry account by 30.04. of each year is nothing new for you as an operator in the EU ETS. Nevertheless, there are always new and unexpected hurdles that can arise for operators and their authorised representatives.
- This can start with technical accesses that do not work, such as a malfunction at the mobile operator, poor reception, a mobile number that is no longer registered for access, an expiration or loss of access data, a denied access in the internal network, etc.
- This can continue with dangerous uncertainty of the authorised representative as to how and how many allowances are to be submitted, a failure to convert CER into EUA or an insufficient account balance due to an additional return of allowances as a result of overallocation.
- Finally, it can end with the unavailability of the authorised representative as a result of holiday, illness, but also resignation, or simply the absence or unavailability of the second authorised representative, who must also confirm a return.
All these obstacles have one thing in common: they are not force majeure, as the European Court of Justice has stated years ago. And this means that the DEHSt sanction has been established and will generally cause the operator to face massive financial difficulties.
Not only the timely purchase of allowances is a prerequisite for a successful submission, but especially the technical access to the registry system and, above all, well-trained and available authorised representatives who are familiar with the system’s defective software.
We can help you!
If you, as the person responsible in your company, are also of the opinion that all processes involving the surrender of emission allowances to the DEHSt involve a large number of avoidable risks, we can only advise you to place this issue in the hands of Emissionshändler.com, a service provider with many years of experience in the context of EUA trading and registry account management.
Our offer to you!
The submission of EUA allowances in the EU ETS requires a high degree of knowledge and experience of the authorised representatives, because not only the operability of an IT system classified as poor could represent a problem, but the failure to submit allowances in general is the central risk in the EU ETS for every operator.
It should be worth looking for alternatives if you only consider the liability questions that arise for the corporate bodies and your employees - which were examined in a legal opinion of the well-known law firm BBH *.
If you then consider the problem of burdening your company employees with additional tasks and training, it is generally no longer economically viable to maintain your own registry account management.
It can make therefore a lot of sense to transfer the risk-intensive process of registry account management in the EU ETS to an external specialist, who has been dealing with this type of service in the EU ETS for its customers in many European countries for over 15 years.
* Emissionshändler.com® will be happy to present extracts from this legal opinion to you in a personal appointment in the form of a presentation.