Spain amended its system for purchasing wholesale electricity by reducing the remuneration of electricity production to remove unfair windfalls for electricity producers caused by issuance of allowances for free under the EU Emissions Trading System (ETS). Electricity producers challenged the measure asserting that it was contrary to Directive 2003/87/EZ (establishing EU ETS) because it effectively made emissions allowances costly. The European Court of Justice rejected the electricity producers arguments, finding instead that the Directive does not preclude remuneration for electricity producers for the purpose of counterbalancing windfall profits resulting from the allocation of emission allowances. In addition, the court found that the legislative measure does not remove  the incentive to reduce greenhouse gas emissions and was thus not inconsistent with the goals of the Directive.

Iberdrola S.A. and Others, Judgement of the Court of 17 of Oct. 2013

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Iberdrola S.A. and Others, Judgement of the Court of 17 of Oct. 2013 - judgment

Filed

International

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An aim to achieve a quantifiable outcome within a given time-frame, set by an institution such as a national government.

Policy instruments are techniques or tools used by governing authorities to promote certain policies in order to achieve predetermined goals. Put simply, instruments are how a government tries to achieve its goals, with this taxonomy being focused on national policy instruments.

Risk is the potential for adverse consequences resulting from the dynamic interplay between (climate-related) hazards, exposure, and vulnerability of affected human or ecological systems.

Groups  of people who are adversely affected by climate change or the response to it

A set of principles, processes, and practices that build economic and political power to shift from an extractive economy to a regenerative economy.

Justice is the ethical and political framework that addresses fairness, including issues of responsibility, rights, and structural inequity.

Renewable energy means all forms of energy produced from renewable sources in a sustainable manner.

Fossil fuel is a generic term for non-renewable energy sources such as coal, fossil gas, and oil (including crude oil, and petroleum products), that can be used for electricity and heat generation. Fossil fuels are hydrocarbons formed from pressurised and heated organic material buried over millions of years.

Molecules in the atmosphere that play a key role in the greenhouse effect by trapping heat radiating from Earth’s surface.

Area of the economy in which actors engage in identical or related activities.

In human systems, the process of adjustment to actual or expected climate change and its effects, in order to moderate harm, increase resilience or exploit beneficial opportunities. In natural systems, the process of adjustment to actual climate change and its effects; human intervention may facilitate adjustment to expected climate change and its effects.

The management and allocation of funds, assets and investments to meet various objectives

A subsidy is a direct or indirect payment to individuals or businesses, typically provided as a government cash payment or a specific tax reduction.

Tradable permits are market-based tools that grant permission for specific activities, frequently used to regulate emissions. These permits can be issued within a trading system to manage environmental impacts.

Either money or something of monetary value is transferred between two or more organisations, people or countries.

The release of heat-trapping gases, primarily from human activities such as burning fossil fuels, agriculture and industry.

A long-lived, colourless gas, chiefly emitted from fossil fuel combustion, deforestation and cement production.

Electrical energy generated from mechanical devices driven by flowing fresh water.

Fossil gas, commonly known as natural gas, is a fossil fuel consisting chiefly of methane with smaller amounts of other hydrocarbons and trace gases, found in underground deposits.

Any compulsory, unrequited payment to the government levied on corporations or individuals. This can be for environmental reasons, such as introducing a Carbon tax to set a price that emitters must pay for the greenhouse gases they emit.

The activities of industries involved in the production, distribution, and sale of energy, including electricity, gas, and renewables.

Activities that provide lodging, food, and entertainment services to guests, including hotels, restaurants, and resorts.

This sector includes firms and individuals offering specialised expertise in fields such as law, accounting, consulting, science and engineering.

Iberdrola S.A. and Others, Judgement of the Court of 17 of Oct. 2013 - judgment

Target

Policy instrument

Renewable energy

Fossil fuel

Greenhouse gas

Economic sector

Finance