Spain won’t revise offset plans until 2011: minister

Spain will stick with plans to buy 159 million emission rights or offsets, at least until 2011.

Although the economic slump will mean Spain's greenhouse gas (GHG) emissions will be lower than previously forecast, the government will wait before it considers any changes to plans on buying carbon offsets or emissions rights, said Teresa Ribera, Spain’s climate change minister.

“Our emissions will probably be a little bit lower over the first commitment period, but we will maintain a prudent attitude and not consider any changes before 2011,” she told Point Carbon on the sidelines of the Carbon Expo in Barcelona.

The government said in 2006 it plans to buy 159 million offsets and government emission rights to meet its target set by the Kyoto protocol.

The Kyoto pact requires Spain to limit GHG emissions growth to 15 per cent above a 1990 baseline between 2008 and 2012.

Rapid economic development drove Spain’s emissions to around 50 per cent over the 1990 level by 2007.

But a sharp downturn in the Spanish economy over the past 12 months has prompted lower emissions forecasts as power demand falls and factories cut output.

The most recent estimate reckons Spain's emissions are around 43 per cent over the Kyoto baseline level.

The government has yet to outline what proportion of the 159 million tonnes will be project-based, UN-backed offsets, and how much of the remainder will be government emission rights, also known as assigned amount units (AAUs).

Ribera insisted the focus of government buying would consist of carbon offsets under the UN’s clean development mechanism (CDM), credits known as certified emissions reductions (CERs).

But the minister added that limited CER supply had forced the government to enter the AAU market to meet its buying needs.

Based on funds committed so far, Spain is Europe's biggest government buyer of UN-backed offset credits.

In addition, the government has signed a contract to buy more than 6 million AAUs from Hungary, and is understood to be in negotiations with other central and eastern European countries to buy more.