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FEBRUARY ENVIRONMENT COUNCIL

I attended the EU Environment Council in Brussels on 28 February along with my Hon Friend the Minister of State for Climate Change and Industry (Nick Hurd MP).

I wish to update the House on the matters discussed.

EU Emissions Trading System (ETS) – Council Agreement

The main outcome of Council was reaching an agreed position (‘General Approach’) on the reform of the EU Emission Trading System (ETS) for Phase IV of the system (2021-2030). Council began with a full roundtable debate of the EU ETS where Ministers set out their respective policy positions. The UK expressed support for reaching an agreed position that achieved the right balance between incentivising change and supporting competitiveness. Following the debate, the Presidency presented a revised proposal and called for an informal vote of agreement.

The key elements of the agreement are:

• a provision to increase, if necessary, the volume of free allowances allocated to support industrial sectors at risk of carbon leakage (where production relocates outside of the EU as a result of carbon costs);
• two provisions to strengthen the carbon price – increasing the rate at which allowances are removed from the market and placed in a reserve, and, from 2024, annually cancelling allowances within the reserve above a certain threshold.

The UK Government considers this to be a balanced package that incentivises cost effective carbon reduction, while safeguarding the competitiveness of UK industry. The agreement to reform the EU Emissions Trading System is a positive step forward in collaboration with our European partners to reduce emissions across all sectors.

The European Parliament reached an agreed position on EU ETS reform on 15 February. The file will now progress to the next stage of negotiations, ‘trilogues’, where Member States (represented by the Presidency), European Parliament and the Commission negotiate a final agreement on the reform package.

2030 Agenda for Sustainable Development

Council discussed the implementation of the 2030 Agenda for Sustainable Development, following the publication of a Commission Communication in November 2016. The Commission presented its on-going work including the use of Better Regulation tools and the Regulatory Scrutiny Board to ensure coherence across policy areas within the 2030 agenda. Many Member States highlighted the need for greater co-ordination between policy areas and the need to mainstream the environmental dimension of the 2030 Agenda into other policy areas. The UK called on the Commission to focus on the coherence of existing mechanisms. The Presidency circulated a brief summary of the exchange of views that would serve as a contribution to a forthcoming discussion at the General Affairs Council.

EU Environmental Implementation Review

Ministers exchanged views on the 2017 Annual Growth Survey (AGS) in the context of the European Semester and how it links with the Environmental Implementation Review (EIR). Whilst most Ministers welcomed the 2017 AGS, particularly aspects including sustainable and climate related investment and the transition towards a low-carbon and circular economy, some regretted that environmental and sustainability aspects were still not given a more prominent role in the AGS. They also underlined the importance of stronger links with wider EU environment policy. Ministers broadly welcomed the Commission's new EIR as a useful tool to improve the implementation of EU and national environmental policy and as a contribution to the greening of the European Semester. Some Member States underlined the need for national reports to be based on sound scientific data.

AOB items

AOB - Emission Trading System (ETS) – Aviation

The Commission presented its proposal on the future of aviation in the EU Emission Trading System (ETS) post-2016. The proposal recommends a continuation of the reduced, intra-EEA scope of aviation in the ETS beyond 2016. This would mean that the current rules would remain unchanged. The proposal also requires the Commission to conduct a further review once there is more certainty about the rules for the Global Market Based Measure (GMBM) for aviation, and to make recommendations for Aviation EU ETS in the post-2020 period.

AOB - Paris Agreement: International Developments

The delegations from France and the Netherlands provided information on International developments regarding the implementation of the Paris Agreement.

AOB - EU Action Plan for the Circular Economy

The Commission provided an update to the Council on the EU Action Plan for a Circular Economy.

AOB - Natura 2000 in the European Solidarity Corps

The Commission provided information to Council on Natura 2000 and the European Solidarity Corps.

AOB - Luxembourg Circular Economy Hotspot (June 2017)

The delegation from Luxembourg provided information on their upcoming Circular Economy Hotspot event in June 2017.

AOB - Environmental concerns regarding Belarus nuclear power plant

The delegation from Lithuania noted their concerns regarding a nuclear power station in Belarus. The Commission highlighted the importance of compliance with international law on nuclear safety.

AOB - Scientific Conference on ‘Sustainable Development and climate changes in the light of the encyclical letter of Holy Father Francis, entitled Laudato Si’

The delegation from Poland provided information on the Conference on Sustainable Development in light of the papal encyclical Laudato Si.

AOB – Update on the Environmental Liability and Mining Waste Directives

The delegation from Hungary (supported by Poland) provided information to the Council on the Environmental Liability Directive and the Mining Waste Directive.

On 23 June, the EU referendum took place and the people of the United Kingdom voted to leave the European Union. Until exit negotiations are concluded, the UK remains a full member of the European Union and all the rights and obligations of EU membership remain in force. During this period the Government will continue to negotiate, implement and apply EU legislation. The outcome of these negotiations will determine what arrangements apply in relation to EU legislation in future once the UK has left the EU.