Dutch Emissions Authority Reports Significant Drop in CO2 Emissions by Large Companies in Industrial Sector

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  Heleen Ekker

  editor Climate and Energy

Large companies in the industrial sector emitted more than 8 percent less CO2 last year than the year before. This is the largest drop in fifteen years, reports the Dutch Emissions Authority (NEa).

The CO2 emissions of all companies that fall under the emissions trading system (not only industry but also energy companies) fell by 7.6 percent. These companies are only allowed to emit CO2 if they buy rights to do so. Together they emit about half of the total amount of CO2 in the Netherlands.

Emissions from the four coal-fired power plants in the Netherlands did not decrease, but remained virtually the same and amount to approximately 8 percent of total Dutch emissions.

Both developments are easy to explain. The high price of natural gas has slowed down production in companies, while coal-fired power stations have been allowed to continue operating at full capacity so that less gas is needed. Although the decline is good for the climate in the majority of companies, it is difficult to say anything about its long-term significance, says NEa director Mark Bressers.

“Last year’s drop was mainly caused by less production due to high energy prices and much less by sustainability. On the other hand, those prices probably won’t go back to the old normal anytime soon, so I do expect this to be a driver for the industry to become more green.” Because if anything has become clear, says Bressers, it is that a high energy price is a clear incentive to emit less.

But the future remains uncertain. Emissions in the chemical sector in particular fell sharply last year, and less fertilizer was produced. Both types of companies are major users of natural gas. The big question is therefore whether emissions will continue to fall from now on, or whether production will pick up again and the weather will soon pick up business as usual is becoming.

Companies can also choose to move their production abroad, which ultimately does not help the climate, says Bressers.

Tata Steel is still the company with the largest CO2 emissions in the Netherlands. Three of the four coal-fired power stations are in the top 10 of largest emitters. Coal is the most polluting way of generating energy. Initially, the coal-fired power stations were only allowed to run at 35 percent of their capacity last year, because of the climate.

But because of the war in Ukraine and the ensuing energy crisis, this ceiling was withdrawn during the year, resulting in higher emissions. It led to a production that was almost the same as the year before: 11.7 million tons of CO2. With the exception of one power station, all coal-fired power stations emitted more CO2 last year than the ceiling of 35 percent (see box).

The European emissions trading system will be expanded and tightened considerably in the coming years. So far, only companies from the energy-intensive industry and the electricity sector are covered by the system, as are part of the flights from the aviation sector. The ETS was criticized for years because there were too many free allowances in circulation and the price for CO2 was too low, but that has changed in recent years.

The price of CO2 is now so high that it has become an important factor for companies. The number of allowances in the market is also deliberately reduced every year, until there are no more allowances left around 2040. In addition, work is underway in the EU on a similar system for the built environment and transport.