The Fuel Emissions Trading Act – Introduction of a National Emissions Trading System in Germany

^{(last updated January 2021)}

On 1 January 2021, the national fuel emissions trading system (nationaler Emissionshandel – “nEHS”) will start in Germany. The nEHS is designed as a supplement to the European emissions trading system (“EUETS”)
and will introduce a CO2 price for emissions from the heating and transport sector. The legal basis for the nEHS the Fuel Emission Trading Act (Brennstoffemissionshandelsgesetz – “BEHG”). However, many questions concerning the execution of the nEHS are still unresolved and important legal regulations for implementation have not yet been adopted. What can be said with certainty is that the energy industry and consumers will have to bear considerable additional costs, whereby the allocation of such costs is still unclear in many cases. Affected companies should prepare themselves in time.

In this paper Andreas Metschke (Axpo Deutschland GmbH) and Dr. Tobias Woltering describe the key points of the nEHS and deal with the following questions:

• How does the nEHS work?
• What are the costs of emission certificates?
• Which fuels does the nEHS cover?
• What is the relationship between the EU-ETS and the nEHS?
• Who is the addressee of the BEHG?
• What are the obligations of the Responsible Party?
• How does the Responsible Party calculate the relevant fuel emissions?
• What applies to the material use of fuels other than natural gas?
• How does the trade with emission certificates in the Emissions Trading Registry work?
• Can the Responsible Party pass on the costs from the nEHS to its customers?
• What are the sanctions for violations?

The PDF with the complete paper can be downloaded here.