Kazakhstan will hand out 746.5 million allowances to the 140 companies covered by its carbon market in the third phase of the scheme, with an additional 21.9 million set aside in reserves, according to the final version of its allocation plan.
The final plan, approved by the government, includes an increase of nearly 9 million permits over the 2016-2020 period compared to the government’s draft.
It is difficult to compare the annual allocation of 149.3 million allowances to the second trading period, spanning 2014 and 2015, as there have been changes in the list of covered facilities.
The plan, based on grandfathering of emission permits, aims to keep company emissions at their 2013-2014 levels to 2020. The reserve was calculated based on expected GDP growth over the next five years, but the circumstances under which the permits in the reserve would be released were not immediately clear.
The biggest sector in the Kazakhstan ETS is electricity generation, where 53 entities will receive 472.6 million allowances over the five years. The government will hand out 190.5 million allowances to mining, metallurgical and chemical firms, and 83.4 million to oil and gas companies.
The market has been over-allocated in the first three years since it was launched in 2013, with prices ranging from $0.20 to $4 per tonne of CO2.
Kazakhstan has pledged to cut its greenhouse gas emissions 15% or 25% below 1990 levels by 2030.
By Stian Reklev – email@example.com