Romania and nine other members of the European Union can allocate a limited number of free certificates for emission of greenhouse gas to power plants during 2013-2019, instead of selling them, according to the European Commission (EC).

The free certificates should not exceed 70 percent of all certificates received in 2013 and will decrease annually, so as to reach zero in 2020. Countries that choose to distribute free certificates must submit an application to the EC until September 30 this year.  The 10 EU member states that can give free certificates are Romania, Bulgaria, the Czech Republic, Estonia, Cyprus, Latvia, Lithuania, Hungary, Malta and Poland.

Launched in 2005, the EU Emissions Trading System (ETS) works on the "cap and trade" principle. This means there is a limit on the total amount of certain greenhouse gases that can be emitted by the factories, power plants and other installations. Within this cap, companies receive emission allowances which they can sell to or buy from one another as needed.

Irina Popescu, irina.popescu@romania-insider.com