Can a member state decide to auction more allowances after the EC has decided on the national allocation plan?
Yes, but only within a specific time period. This flexibility is specifically noted in each EC decision on a national allocation plan. However, there are two caveats. First, the share of allowances allocated free of charge can only be reduced before a member state takes its final allocation decision, which must in turn be before the start of the 2008-2012 trading period. The primary objective of a member state’s final allocation decision is to update the proposed national allocation plan submitted to the EC in response to the EC’s decision on that plan. Second, the share of allowances allocated free of charge cannot be reduced beyond the limit set under the emissions trading directive, which states that at least 90% of allowances are to be allocated for free during the 2008-2012 trading period.
