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March 13th 2009

IRELAND’S GREENHOUSE GAS EMISSION PROJECTIONS 2008-2020

Summary

The National Climate Change Strategy (NCCS 2007)1 designated the EPA with responsibility
for developing annual national emission projections for greenhouse gases (GHG) for all key
sectors of the economy, in collaboration with relevant State and other bodies. Emission
projections serve to inform national policy initiatives, such as the annual Carbon Budget, and
allow Ireland to comply with EU reporting obligations on projections (e.g. Council Decision
280/2004).

The EPA will produce GHG emission projections annually as this will allow the most recent
environmental and other policy developments to be taken into account as well as updates to
key assumptions (such as revisions to anticipated economic growth). The projections
presented here update the previous set of national emissions projections which were
published in September 20082 by the EPA.

The projections presented here are, primarily, underpinned by SEI’s energy forecasts which
are based on the Credit Crunch scenario from the ESRI’s 2008 Medium-Term Review3 (the
forecast was updated to take account of the Autumn 2008 Quarterly Economic
Commentary4). This assumes a recession in the short term (2008-2009) but that the economy
reverts back to where it otherwise would have been by 2020. Since these energy forecasts
were prepared the economic outlook has deteriorated even further than anticipated. As a
result, an Economic Shock analysis was carried out as part of a sensitivity analysis which is
presented and discussed.

It is most likely that the actual out-turn for future emissions of greenhouse gas emissions is
best reflected in the Economic Shock analysis given the deterioration in the economic outlook
in recent months. It is unlikely that the extent of the economic down-turn will be limited to a
0.5% contraction in GDP in 2008 and 2009 (which is the basis for ESRI’s Credit Crunch
scenario and hence the With Measures and With Additional Measures scenarios) but that a
deeper recession is now underway. As more up-to-date economic analysis and energy
forecasts become available, the EPA will update emissions projections accordingly.

1
National Climate Change Strategy 2007 - 2012. Department of Environment, Heritage and Local Government.
(2007).
2
Ireland’s National Greenhouse Gas Emissions Projections to 2020. Environmental Protection Agency. (2008).
3
Medium Term Review 2008 – 2015. Economic and Social Research Institute. (2008).
4
Quarterly Economic Commentary. Economic and Social Research Institute. (2008).

1
The emission projections have been produced, under two scenarios, for each key emission
sector up to 2020. An Economic Shock analysis was applied to both scenarios. The two
scenarios show two potential outlooks for emissions to 2020 depending on policy
development and implementation.

(i) The With Measures scenario is based primarily on SEI’s Baseline energy forecast5
which incorporates the anticipated impacts of policies and measures that were in
place (and legislatively provided for) by end of 2007.
(ii) The With Additional Measures scenario is based on SEI’s White Paper energy
forecast. The White Paper energy forecast builds on the Baseline energy forecast
with additional assumptions to incorporate the targets and planned measures in the
Energy White Paper6 and revised National Energy Efficiency Action Plan7.
Therefore this scenario includes existing and planned policies and measures.

Greenhouse Gas Emission Targets

Ireland is currently faced with meeting two targets with respect to greenhouse gas emissions.
The first of these is the Kyoto Protocol to the United Nations Framework Convention on
Climate Change (UNFCCC) which limits Ireland’s total national emissions to an average of
62.8 Mtonnes of CO2e per annum (13% above the baseline estimate) in the period 2008 –
2012.

The Kyoto Protocol is, however, only a first step in addressing the serious global threat of
climate change. The ultimate goal of the UNFCCC is to stabilise atmospheric concentrations
of greenhouse gases at a level that prevents dangerous human interference with the climate
system. Therefore, in January 2008 the EU Commission put forward a package of proposals
that will deliver on the European Union's commitments to fight climate change and promote
renewable energy up to 2020 and beyond. The package seeks to deliver a 20% reduction in
total EU greenhouse gas emissions by 2020 (relative to 1990 levels) and at the same time to
increase to 20% the share of renewable energies in energy consumption. This package was
agreed, with some amendments, by the EU Parliament and Council in December 2008. The
emissions reduction will be increased to 30% by 2020 when a new global climate change
agreement is reached.

In the package, the total effort for greenhouse gas reductions by 2020 has been divided
between the sectors covered by the EU Emissions Trading Scheme (ETS) and non-ETS
sectors8. For those sectors covered by the EU ETS, a single EU-wide cap has been agreed.
Consequently, there are no specific national emissions targets for emissions from ETS sectors
in 2020. For those sectors that are not covered by the EU ETS, individual targets for Member
States, which average out at 10% reduction in 2020 (compared to 2005), have been agreed.
The target for Ireland for non-ETS sector emissions is to reduce emissions by 20% by 2020
relative to 2005 levels which equates to 37.9 Mtonnes of CO2e emissions in 2020 (calculated
by the EU Commission in 2008).

5
Energy in Ireland. 1990-2007. Sustainable Energy Ireland. (2008).
6
Delivering a Sustainable Energy Future for Ireland. The Energy Policy Framework 2007-2020. Department of
Communications, Marine and Natural Resources. (2007).
7
National Energy Efficiency Action Plan for Ireland 2007 – 2020. Department of Communication, Energy and
Natural Resources. In preparation.
8
Non-ETS sector emissions refer to emissions from sources that are not included in the emissions trading
scheme such as transport, households, services, smaller industrial installations, agriculture and waste.

2
Comparison with Kyoto Protocol Limit (2008 – 2012)

The projections indicate the level of total national emissions in Ireland over the Kyoto period
2008 – 2012 and, therefore, indicate our distance to the Kyoto Protocol limit under the two
emissions projection scenarios and the Economic Shock analysis. The impact of forest sinks is
included in each scenario as allowed for under Article 3.3 of the Kyoto Protocol. The
implications for Government use of Kyoto Mechanisms and/or the need for additional
domestic action is summarised below:

• Under the With Measures emission projection, Government use of Kyoto

Mechanisms and/or additional domestic action of 5.2 Mtonnes of CO2e per
annum are required to meet our Kyoto Protocol limit.

• Under the With Additional Measures emission projection, Government use of

Kyoto Mechanisms and/or additional domestic action of 3.6 Mtonnes of CO2e per
annum are required to meet our Kyoto Protocol limit.

• Applying the Economic Shock analysis to the With Additional Measures emission
projection indicates that Government use of Kyoto Mechanisms and/or additional
domestic action could reduce to between 1.3 – 1.8 Mtonnes of CO2e per annum.

Comparison with EU 2020 Targets for non-ETS sector emissions

The projections have been disaggregated into EU ETS and non-ETS sectors to allow a
comparison to be made with the 2020 target for non-ETS sector emissions. It was agreed by
the EU Parliament and Council in December 2008 that, in the event that an international
agreement on global reductions is not reached, Member States may include emissions and
removals from activities related to land-use, land-use change and forestry (LULUCF) towards
meeting the 20% reduction target (relative to 1990). The aim is that this proposal would enter
into force from 2013 onwards.

• Under the With Measures scenario, non-ETS sector emissions are projected to be
15.9 Mtonnes of CO2e higher in 2020 than our 2020 target. Including the impact
of carbon sinks reduces the distance to target to 11.5 Mtonnes of CO2e.

• Under the With Additional Measures scenario, national emissions are projected to
be 8.1 Mtonnes of CO2e higher in 2020 than our 2020 target. Including the impact
of carbon sinks reduces the distance to target to 3.8 Mtonnes of CO2e. A
significant reduction in the distance to the 2020 target is projected in this scenario
relative to the With Measures scenario. This is attributable to the projected impact
of all policies and measures outlined in the Energy White Paper6 and the revised
Energy Efficiency Action Plan7 which predominantly come into effect between
2010 and 2020.

• It is important to note that the With Additional Measures scenario assumes that (i)
all the relevant policies and measures outlined in these Government policy
documents will be adopted and fully implemented on time and (ii) all relevant
measures will achieve the full emissions reductions anticipated. Failure to deliver
these measures or a reduction in their environmental effectiveness will result in

3
 higher emissions levels than projected. The difficulties associated with meeting
these criteria should not be underestimated.

• Applying the Economic Shock analysis to the With Additional Measures non-ETS
sector emission projection (including carbon sinks) for 2020 indicates a reduction
in the distance to target to 2.7 Mtonnes of CO2e per annum.

4
Background

The National Climate Change Strategy (NCCS 2007)1 designated the EPA with responsibility
for developing annual national emission projections for greenhouse gases (GHG) for all key
sectors of the economy, in collaboration with relevant State and other bodies. Emissions
projections serve to inform national policy initiatives, such as the annual Carbon Budget, and
allow Ireland to comply with EU reporting obligations on projections (e.g. Council Decision
280/2004).

The EPA will produce GHG emission projections annually as this will allow the most recent
environmental and other policy developments to be taken into account as well as updates to
key assumptions (such as revisions to anticipated economic growth). The projections
presented here update the previous set of national emissions projections which were
published in September 20082 by the EPA.

The latest projections are given below with a discussion of the key trends and a commentary
on the significance of the figures in relation to Ireland’s commitments for the Kyoto period,
2008 – 2012, and in relation to the EU 2020 emission targets for non-ETS sector emissions.

These projections are underpinned by data provided by a range of other State agencies and
organisations, most notably Sustainable Energy Ireland (SEI) for energy forecasts and
Teagasc for forecast animal numbers. Energy-related emissions projections are based on
energy forecasts published by SEI in December 20085. These energy forecasts are based on
the same macro-economic assumptions that underpin the Credit Crunch scenario contained in
ESRI’s Medium Term Review 2008 – 20153 which was revised in the Autumn of 2008 to
take account of the severity of the current economic downturn as outlined in ESRI’s Autumn
2008 Quarterly Economic Commentary4. This implies annual average real GNP growth of
−0.4% between 2008 and 2009 (3.4% growth in total between 2007 and 2010), increasing to
4.8% per annum between 2010 and 2015 (26% growth in total between 2010 and 2015) and
4.2% between 2015 and 2020 (23% growth in total between 2015 and 2020). In terms of
GDP, the growth rates are −0.5% between 2008 and 2009 (2.8% growth in total between
2007 and 2010), 4.7% between 2010 and 2015 (26% growth in total between 2010 and 2015)
and 4.3% between 2015 and 2020 (23% growth in total between 2015 and 2020).

When publishing the energy forecasts, SEI state that “these forecasts were produced during
September and October 2008 and by November ESRI anticipates that there would be even
lower growth in 2008-2009, although it is not expected to cause significant deviation in the
2020 projection”. As a result, an Economic Shock analysis was carried out as part of a
sensitivity analysis. In the Economic Shock analysis, ESRI assume that GNP will contract by
7% between 2007 and 2010, grow by 33% between 2010 and 2015 and 24% between 2015
and 2020. In terms of GDP, the ESRI assume that GDP will contract by 8% between 2007
and 2010, grow by 33% between 2010 and 2015 and 25% between 2015 and 2020. The
scenario assumes that there will be a permanent loss in output or a scarring effect, so that the
level of GNP will be 5% below the SEI Baseline energy forecast in the long run and 4%
lower for GDP. The economic forecast underlying the Economic Shock analysis is consistent
with the ESRI’s Winter 2008 Quaterly Economic Commentary.

5
Ireland’s Greenhouse Gas Emission Projections

Two emissions projections were produced (underpinned by SEI energy forecasts and
therefore ESRI’s Credit Crunch scenario) which show two potential outlooks to 2020
depending on policy development and implementation. These are called

• With Measures
• With Additional Measures

An Economic Shock analysis was applied to both of these scenarios. A description of the two
scenarios and the Economic Shock analysis is provided in Table 1.

Table 1. Description of Projection Scenarios

Scenario Basis for Projection
With Energy-related emissions projections
Measures 5
• Based on SEI Baseline energy forecast . These energy forecasts are based
Scenario on the Credit Crunch scenario contained in ESRI’s Medium Term Review
3
2008 – 2015 which was revised in the Autumn of 2008 to take account of the
severity of the current economic downturn as outlined in ESRI’s Autumn 2008
4
Quarterly Economic Commentary .

Agriculture emission projections

• Based on forecast animal numbers produced by Teagasc in November 2008.

Waste
• Assumes that per capita levels of waste generation and the share of
biodegradable waste going to landfill remain at 2007 levels.

Forestry
• Projections of the future impact of forest sinks were provided by COFORD. It
is assumed that afforestation levels average 8,000 hectares per annum up to
2020. Recent afforestation levels are below 10,000 hectares.
With Energy-related emissions projections
Additional • Based on SEI White Paper energy forecast. The White Paper energy forecast
Measures builds on the Baseline energy forecast with additional assumptions introduced
Scenario 6
to incorporate the measures and targets in the Energy White Paper and the
7
revised Energy Efficiency Action Plan .

Agriculture emission projections

• Same as With Measures scenario.

Waste
• Assumes that the Landfill Directive targets (Directive 1999/31/EC) will be
reached in 2010, 2013 and 2016.

Forestry
• Same as With Measures scenario.
Economic An Economic Shock analysis was carried out on SEI’s Baseline energy forecast,
Shock which underpins the With Measures scenario, for energy-related emissions
projections.

The same percentage reductions, as observed when the Economic Shock is applied
to the With Measures scenario, were applied to the With Additional Measures
scenario.

6
WITH MEASURES SCENARIO

The trend in emissions from 1990 to 2007, with projected trends for the With Measures
scenario is shown in Figure 1. In addition, total projected emissions under the Economic
Shock analysis are shown.
85,000

75,000

65,000

55,000
ktonnes, CO2e

45,000

35,000

25,000

15,000

5,000

-5,000
1990 1995 2000 2005 2006 2007 2008 2009 2010 2010 2011 2012 2013 2014 2015 2015 2016 2017 2018 2019 2020 2020

Energy Residential Industry & Commercial Agriculture Transport Waste Carbon sinks Economic Shock

Figure 1. Historical and projected trends in GHG Emissions for the With Measures scenario 1990-2020

• The With Measures scenario is based on SEI’s Baseline energy forecast. Under the
With Measures scenario, GHG emissions in Ireland are projected to increase by 2%
between 2007 and 2020, implying an average annual growth rate of 0.2%. This
includes forest sinks (assuming afforestation levels of 8,000 hectares per annum) as
allowed for under Article 3.3 of the Kyoto Protocol.

• Under the Economic Shock analysis (applied to the With Measures scenario), total
greenhouse gas emissions projections are projected to be 6% lower in 2010, 3% lower
in 2015 and 2% lower in 2020 compared with the With Measure scenario. Emissions
in 2020 are projected to be the same as in 2007 under this analysis when carbon sinks
are also included.

7
WITH ADDITIONAL MEASURES SCENARIO

The trend in emissions from 1990 to 2007, with projected trends for the With Additional
Measures emission projection is shown in Figure 2. In addition, total projected emissions
under the Economic Shock analysis are shown.
75,000

65,000

55,000
ktonnes, CO2e

45,000

35,000

25,000

15,000

5,000

-5,000
1990 1995 2000 2005 2006 2007 2008 2009 2010 2010 2011 2012 2013 2014 2015 2015 2016 2017 2018 2019 2020 2020

Energy Residential Industry & Commercial Agriculture Transport Waste Carbon sinks Economic Shock Carbon sinks

Figure 2. Historical and projected trends in GHG Emissions for the With Additional Measures
scenario 1990-2020

• Under the With Additional Measures emission projection, GHG emissions in Ireland
are projected to decrease by 18% between 2007 and 2020 which implies an annual
average reduction of 1.5%. This includes forest sinks (assuming afforestation levels of
8,000 hectares per annum) as allowed for under Article 3.3 of the Kyoto Protocol.

• As stated above, the With Additional Measures emission projection is based on SEI’s
White Paper energy forecast and includes targets and planned policies and measures
from the Energy White Paper6 and the revised Energy Efficiency Action Plan7 as well
as existing and currently implemented policies and measure. The key measures from
the Energy White Paper and the revised Energy Efficiency Action Plan are:

(i) By 2020, Ireland will have achieved a 20% improvement in energy efficiency

(ii) By 2020, renewable energy will contribute

33% of gross electricity consumption

10% of non-aviation transport energy

12% of thermal energy

• It should be noted that while the White Paper energy forecast assumes the Energy
White Paper targets will be met, not all of the targets are currently associated with
specific measures.

8
 • The Economic Shock analysis is also shown in Figure 2. These data are derived
simply by applying the same percentage reduction to the With Additional Measures
emissions projection as observed when the Economic Shock was applied to the With
Measures scenario. Therefore, when the Economic Shock analysis is applied to the
With Additional Measure scenario, total greenhouse gas emissions projections are
projected to be 6% lower in 2010, 3% lower in 2015 and 2% lower in 2020.
Emissions in 2020 are projected to be 20% lower compared to 2007 under this
analysis when carbon sinks are also included.

The overall results are summarised in Table 2.

Table 2. Summary of % Changes in Emissions Projections

% changes between Annual average change
Scenario
2007 and 2020 between 2007 and 2020
With Measures With forest sinks 2% 0.2%
Economic Shock
on With Measures With forest sinks 0% 0%
scenario
With Additional
With forest sinks -18% -1.5%
Measures
Economic Shock
on With Additional With forest sinks -20% -1.7%
Measures scenario
Note forest sinks = afforestation

9
BY SECTOR

Figure 3 shows the projected contributions from each of the sectors to total national
emissions for the With Measures and With Additional Measures scenario averaged over the
2008 – 2012 period. Agriculture and transport sector emissions account for around 50% of
emissions under both scenarios.

Waste Waste
3% Energy 3% Energy
Transport 21% Transport 20%
21% 22%

Residential
Residential 11%
11%

Agriculture Agriculture Industry &

28% Industry &
28% Commercial
Commercial
16%
16%

With Measures With Additional Measures

Figure 3. Projected share of total greenhouse gas emissions by sector averaged over the period 2008 – 2012

Figure 4 shows the projected contributions from each of the non-ETS sectors to total non-
ETS sectors emissions in 2020. Under the two emissions projections, agriculture and
transport sector emissions account for around 70% of total non-ETS emissions.

Energy - non-CO2 Energy - non-CO2

Waste Waste
1% 1%
4% Residential 3%
Residential
14%
17%
Agriculture
33% Agriculture
Industry&
Commercial 39%

Industry& 8%
Commercial
11%

Transport
Transport
35%
34%

With Measures With Additional Measures

Figure 4. Projected share of non-ETS greenhouse gas emissions by sector in 2020

10
Transport

• Under the With Measures scenario, transport emissions are projected to increase by
26% over the period 2007 – 2020 to 18.1 Mtonnes of CO2e.

• Under the With Additional Measures scenario, transport emissions are projected to
increase by 11% over the period 2007 – 2020 to 16.0 Mtonnes of CO2e. In this
scenario, it is assumed that the use of biofuels increases to 10% of all road transport
fuel use by 2020 which will have a significant impact on CO2 emissions from this
sector. In addition, policies and measures such as the delivery of Transport 21 and its
alignment with spatial planning, an energy efficient driving campaign and the recent
changes to VRT and motor tax so that they are linked to CO2 emissions are included
in this scenario.

• The growth in transport emissions is projected to slow significantly compared with

the annual growth rate between 1990 and 2007. This is attributable to a projected
slow-down in economic growth, particularly up to 2010. Improving the quality and
robustness of transport emission projections will be a key focus for future work.
Transport sector emissions are highly dependent on key forecast variables including
economic indicators such as GDP, vehicle technology and the future travel behaviour
of individuals. A continual focus on these key underlying drivers and their impact on
transport emission levels will be important.

Energy

• Under the With Measures scenario, emissions are projected to increase by 1% over the
period 2007 – 2020 to 15.0 Mtonnes of CO2e. In this scenario, it is assumed that 15%
of Ireland’s gross electricity consumption comes from renewable energy by 2010.

• Under the With Additional Measures scenario, emissions are projected to decrease by
37% between 2007 and 2020 to 9.4 Mtonnes of CO2e. The model is specified, in this
scenario, to allow renewable energy to contribute 33% of gross electricity
consumption by 2020 (primarily wind but also biomass). In addition, energy
efficiency improvements, in line with targets set down in the Energy White Paper6
and the revised Energy Efficiency Action Plan7, are forecast to reduce demand for
electricity which subsequently impacts on emissions from this sector.

• Under both With Measures and With Additional Measures emissions projections,
combined emissions from all ETS sectors are projected to be below the annual
allocation of allowances that operators received under the second National Allocation
Plan9. This is as a result of the projected slow-down in economic growth over the
short-term and, in addition, a projected increase in electricity imports from the UK
which will displace the use of fossil fuels in the production of electricity in Ireland.

9
Ireland’s National Allocation Plan for Emissions Trading 2008-2012. Environmental Protection Agency.
(2008).

11
Agriculture

• There is only one scenario for agricultural emission projections. Emissions are
projected to decrease by 4% over the period 2007 – 2020 to 17.8 Mtonnes of CO2e.
The agricultural emissions projections presented here are 10% lower in 2020
compared to those published by the EPA in 20082.

• Agricultural emissions projections are based on forecast animal numbers produced by

Teagasc in November 2008. These forecasts take account of the most recent
developments (as of November 2008) in relation to removal of milk quota. The agreed
increase in Irish milk quota between now and the quota removal date in 2015 will be
slightly over 5%. The EPA’s agricultural projections, published in 2008, were
predicated on higher dairy cow numbers as it was assumed at that time that the
increase in Irish milk quota would be significantly greater than 5%.

Residential

• Under the With Measures scenario, emissions from the residential sector are projected
to increase by 29% to 9.1 Mtonnes of CO2e between 2007 and 2020. Energy demand
from the residential sector is significantly higher over the projection period compared
to the SEI’s previous energy forecast10. This is because of two key changes to the
underlying energy demand model, namely (i) the forecast for real personal disposable
income has increased and (ii) the sensitivity of the forecast to real personal disposable
income has also increased. Real disposable income is a key determinant in forecasting
non-electricity energy demand from the residential sector. These changes have
resulted in a higher forecast energy demand from the residential sector and therefore
higher associated emissions.

• Under the With Additional Measures scenario, emissions are projected to decrease by
6% between 2007 and 2020 to 6.6 Mtonnes of CO2e. Under this scenario, the impact
of policies and measures, primarily, from the revised National Energy Efficiency
Action Plan7 are included. These measures include Building Regulations, SEI Warmer
Homes Scheme and Home Energy Saving Scheme. The impact of these planned
measures was re-assessed by SEI during 2008 and in some cases anticipated
emissions savings were reduced. As a result the With Additional Measures emission
projection for the residential sector presented here is significantly higher than
previously projected2.

Industry and Commercial Services

• Under the With Measures scenario, emissions from the industry and commercial
services sector are projected to increase by 3% between 2007 and 2020. Projected
emissions from this sector are lower than those published by the EPA in 20082; this is
primarily due to the projected decrease in activity from the cement industry,
particularly in the short-term, as a result of the economic down-turn11. In addition,
projected emissions from the commercial services sector are lower than those

10
Energy in Ireland 1990-2006. Sustainable Energy Ireland. (2007).
11
Projected emissions from the cement industry were estimated based on the projected down-turn in the
economy and in housing completions as forecast by the ESRI.

12
 published in 20082. Demand for gas in the commercial services sector is now forecast
to be greater over the projection period while demand for oil is lower. Switching to a
cleaner fuel will result in lower associated emissions.

• Under the With Additional Measures scenario, emissions from the industry and
commercial services sector are projected to decrease by 21% between 2007 and 2020.
In this scenario, energy demand from industrial and commercial services sectors
decreases relative to the With Measures scenario as energy efficiency policies and
measures (as outlined in the Energy White Paper6 and the revised Energy Efficiency
Action Plan7) are assumed to be adopted and implemented. These include the
implementation of forthcoming building regulations, SEI schemes such as SEI Energy
Agreements and the RES-H target (i.e. 12% thermal heat to come from renewables by
2020).

Waste

• Under the With Measures scenario, emissions from the waste sector are projected to
increase by 18% between 2007 and 2020 to 2.3 Mtonnes of CO2e per annum. In this
scenario, it is assumed that waste generation levels and the share of biodegradable
waste going to landfill remain at 2007 levels.

• Under the With Additional Measures scenario, emissions are projected to decrease by
28% below 2007 levels to 1.4 Mtonnes of CO2e in 2020. In this scenario, it is
assumed that the Landfill Directive targets (Directive 1999/31/EC), for the diversion
of biodegradable waste from landfill, are met progressively in 2010, 2013 and 2016.

13
 Comparison with Kyoto Protocol Limit

Under the Kyoto Protocol, Ireland is required to limit total national greenhouse gas emissions
to 314.2 Mtonnes of CO2e over the five year period 2008 – 2012 which is equivalent to 62.8
Mtonnes of CO2e per annum. This is calculated as 13% above Ireland’s 1990 baseline value
which was established and fixed at 55.60 Mtonnes of CO2e following an in-depth review of
Ireland’s 2006 greenhouse gas inventory submissions to the UNFCCC.

Figure 5 shows emissions for the period 1990 to 2020 for each scenario and compares with
the Kyoto Protocol limit for the 2008 – 2012 period. Projected emissions include the impact
of forest sinks as allowed for under Article 3.3 of the Kyoto Protocol.
80000

70000

60000

50000
ktonnes, CO2e

40000

30000
Commitment Period
Kyoto Protocol

20000
(2008-2012)

10000

0
90

91

92

93

94

95

96

97

98

99

00

01

02

03

04

05

06

07

08

09

10

11

12

13

14

15

16

17

18

19

20
19

19

19

19

19

19

19

19

19

19

20

20

20

20

20

20

20

20

20

20

20

20

20

20

20

20

20

20

20

20

20
Total historic GHG emissions EU ETS
Projections (With Measures) Projections (With Additional Measures)
Projections (With Additional Measures and carbon sinks) Economic Shock (on With Additional Measures and carbon sinks)
Kyoto Target Kyoto Protocol base year emissions

Figure 5. Historical and projected GHG Emissions for each scenario and the Kyoto Protocol target

Table 3 shows the projected annual average emissions for the period 2008 – 2012 for the
With Measures and With Additional Measures scenarios and the subsequent distance to the
Kyoto Protocol limit (62.8 Mtonnes of CO2e). The distance to the limit is disaggregated to
show the contribution expected from ETS sectors and non-ETS sectors. It can be seen that
emissions from the sectors covered by the ETS are below the annual allocation of allowances
as set out in the second National Allocation Plan9.

An Economic Shock analysis was carried out on SEI’s Baseline energy forecast, which
underpins the With Measures scenario, for energy-related emissions projections. The same
percentage reductions, as observed with the Economic Shock is applied to the With Measures
scenario, were applied to the With Additional Measures scenario. The energy model was not
re-run and therefore the analysis does not constitute an alternative or ‘new’ scenario. In this
analysis, ESRI assume that GNP will contract by 7% between 2007 and 2010, grow by 33%
between 2010 and 2015 and 24% between 2015 and 2020. In terms of GDP, the ESRI assume
that GDP will contract by 8% between 2007 and 2010, grow by 33% between 2010 and 2015
and 25% between 2015 and 2020. The analysis shows a permanent loss in output or a
scarring effect, so that the level of GNP will be 5% below the SEI Baseline energy forecast

14
(which underpins the With Measures emission projection) in the long run and 4% lower for
GDP.

Under the Economic Shock analysis, emissions are projected to be 6% lower in 2010
compared with annual average emissions over the Kyoto Period for the With Measures
emission projection, 3% lower in 2015 and 2% lower in 2020. Applying the same percentage
reductions to the With Additional Measures emission projection indicates that the
Government use of Kyoto Mechanisms and/or additional domestic action could reduce to
between 1.3 – 1.8 Mtonnes of CO2e per annum over the Kyoto Period. The Government
purchasing requirement or additional domestic action is presented as a range to account for
some degree of uncertainty in the impact of the economic down-turn over the entire Kyoto
Period.

It is most likely that the actual out-turn for future emissions of greenhouse gas emissions is
best reflected in the Economic Shock analysis given the deterioration in the economic outlook
in recent months. It is unlikely that the extent of the economic down-turn will be limited to a
0.5% contraction in GDP in 2008 and 2009 (which is the basis for ESRI’s Credit Crunch
scenario and hence the With Measures and With Additional Measures scenarios) but that a
deeper recession is now underway. As more up-to-date economic analysis and energy
forecasts become available, the EPA will update emissions projections accordingly.

Table 3. Projected annual average emissions for 2008-2012 and distance to Kyoto Protocol limit
With Additional Economic Shock on
With Measures (WM)
Measures (WAM) WAM
Projected Distance Projected Distance Projected Distance
Mtonnes of CO2e
emissions to Limit emissions to Limit emissions to Limit
2008-2012 65.4 2.5 61.8 -1.0 58.4 -4.5
Attributed to EU ETS 19.6* na 17.7* na 16.6*
Attributed to Non-
45.8 na 44.2 na 41.8 – 42.3
ETS
Government
Purchases/Additional 5.2** na 3.6*** na 1.3-1.8****
Domestic Action
Numbers may not sum exactly due to rounding
* Emissions from sectors covered by the ETS are projected to be below the annual allocation as set out in the second National Allocation
Plan 2008-2012 of 22.3 Mtonnes of CO2 per annum.
** 62.8 (Kyoto Limit) – 22.3 (Annual Allowance Allocation for ETS) = 40.6 Mtonnes of CO2e - 45.8 = - 5.2 Mtonnes of CO2e
*** 62.8 (Kyoto Limit) – 22.3 (Annual Allowance Allocation for ETS) = 40.6 Mtonnes of CO2e – 44.2 = - 3.6 Mtonnes of CO2e
**** 62.8 (Kyoto Limit) – 22.3 (Annual Allowance Allocation for ETS) = 40.6 Mtonnes of CO2e – 41.8 = - 1.3 Mtonnes of CO2e.

15
 Comparison with EU 2020 Target
for the Non-ETS Sector Emissions
The Kyoto Protocol is only a first step in addressing the serious global threat of climate
change. The ultimate goal of the UNFCCC is to stabilise atmospheric concentrations of
greenhouse gases at a level that prevents dangerous human interference with the climate
system. Therefore, in January 2008 the EU Commission put forward a package of proposals
that will deliver on the European Union's commitments to fight climate change and promote
renewable energy up to 2020 and beyond. The package seeks to deliver a 20% reduction in
total EU greenhouse gas emissions by 2020 (relative to 1990 levels) and at the same time
increase to 20% the share of renewable energies in energy consumption. The emissions
reduction will be increased to 30% by 2020 when a new global climate change agreement is
reached. Agreement was reached on this package, with some amendments, by the EU
Parliament and Council in December 2008 on legally binding targets to cut greenhouse gas
emissions by 20%, to establish a 20% share for renewable energy and to improve energy
efficiency by 20% by 2020.

In the EU Climate Change Package, the total effort for greenhouse gas reductions by 2020
has been divided between the EU ETS and non-ETS sectors. The following approach has
been adopted:

(i) A single EU wide cap for all emissions covered by the EU ETS, ensuring a level
playing field in the single European market for industrial installations, with a 21%
reduction in EU ETS sector emissions by 2020 (compared to 2005). The annual
cap will decrease along a linear trend line which will continue beyond the end of
the third trading period (2013 – 2020). Consequently, there are no specific
national emissions targets for emissions from those sectors covered by the EU
ETS in 2020.

(ii) An EU-wide reduction of around 10% in 2020 (compared to 2005) for the sectors
that are not covered by the EU ETS. Individual targets for Member States have
been agreed which average out at a total 10% reduction in 2020 (compared to
2005). GDP per capita was used as the main criterion when setting the targets for
Member States. The target for Ireland for non-ETS sectors is to reduce emissions
by 20% in 2020 relative to 2005 levels; the limit was calculated by the EU
Commission as 37.9 Mtonnes of CO2e.

Taken together, the combined ETS and non-ETS EU-wide reductions will result in an overall
reduction of 14% compared to 2005, which is equivalent to a reduction of 20% compared to
1990.

The projections presented here were disaggregated into EU ETS and the non-ETS sectors to
allow a comparison to be made with the 2020 target for non-ETS sector emissions. Table 5
deals only with non-ETS sectors and shows the absolute level of emissions projected for
2020, percentage change for each scenario in 2020 relative to 2005 emission levels and the
implied distance to the 2020 target.

It was agreed by the EU Parliament and Council in December 2008 that, in the event that an
international agreement on global reductions is not reached, Member States may include
emissions and removals from activities related to land-use, land-change and forestry

16
(LULUCF) towards meeting the 20% reduction target (relative to 1990). The aim is that this
proposal would enter into force from 2013 onwards.

Table 5. Projected emissions for non-ETS sector emissions, percentage change relative to 2005 emissions and
distance to 2020 EU Commission Target
With Measures With Additional Economic Shock on
Mtonnes of CO2e
Scenario Measures Scenario WAM
WITHOUT CARBON SINKS*
2020 53.8 46.0 44.9
% change relative to
+14% -3% -5%
2005
Distance to 20% 2020
# 15.9 8.1 7.0
target
WITH CARBON SINKS*
2020 49.4 41.7 40.6
% change relative to
+4% -12% -14%
2005
Distance to 20% 2020
# 11.5 3.8 2.7
target
* Carbon sinks = additional afforestation
#
EU Target for non-ETS emissions in 2020 is 37.9 Mtonnes of CO2e (calculated by the EU Commission)

Applying the Economic Shock analysis to the With Additional Measures non-ETS sector
emission projection (including carbon sinks) for 2020 indicates a reduction in the distance to
target to from 3.8 Mtonnes to 2.7 Mtonnes of CO2e per annum.

The importance of carbon sinks (i.e. planting of new forests – afforestation – at the level of
8,000 hectares per annum up to 2020) is evident from Table 5 where it is projected by
COFORD that carbon sinks will sequester in the order of 4 Mtonnes of CO2 in 2020. The
inclusion of carbon sinks in emissions accounting post-Kyoto are critically important for
Ireland and will play a significant role in bringing Ireland closer to its 2020 target for non-
ETS sector emissions.

Figure 6 shows emissions for the period 2005 to 2020 for each scenario, including the
Economic Shock analysis applied to the With Additional Measures scenario (with carbon
sinks), and Ireland’s 2020 target for non-ETS sector emissions.

17
50,000

40,000

30,000

20,000

10,000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

Total historic non-ETS Projections (With Measures)

Projections (With Additional Measures) Projections (With Additional Measures and carbon sinks)

Economic Shock (on With Additional Measures and carbon sinks) 2020 Target

Figure 6. Total non-ETS sector GHG Emissions for each scenario, compared to hypothetical pathway for
20% reduction target

18
Appendix
Units: 1 Mt = 1,000 kilotonnes = 1,000,000 tonnes

CO2e: total greenhouse gas emissions expressed as CO2 equivalents. The CO2 emission is
added to the equivalent emission of methane, nitrous oxide and so-called F-gases which are
converted to CO2 equivalents using their global warming potentials.

F-gases: These gases comprise the following three gases, HFCs (Hydroflurocarbons), PFCs
(Perfluorcarbons) and SF6 (Sulphur Hexafluoride). They have very much higher global
warming potentials than the naturally occurring GHGs (carbon dioxide, methane and nitrous
oxide).

Table 1. Historical and projected emissions by sector (Mtonnes CO2e per annum) for With Measures and
With Additional Measures scenarios
Total Total
Industry & Carbon (Without (With
Energy Residential Agriculture Transport Waste
Commercial Sinks carbon carbon
sinks) sinks)
1990 11.7 7.4 9.8 19.9 5.2 1.5 - 55.4 -
1995 14.0 6.4 10.0 20.9 6.3 1.7 - 59.2 -
2000 16.7 6.6 12.7 20.5 10.8 1.6 - 69.0 -
2005 16.3 7.4 12.2 19.6 13.0 1.8 - 70.3 -
2006 15.5 7.3 12.0 19.3 13.7 1.8 - 69.7 -
2007 14.9 7.1 12.4 18.6 14.4 1.9 - 69.2 -
Historical

With Measures Scenario

2008-12 14.5 7.4 11.0 18.2 14.4 2.0 -2.2 67.6 65.4
2015 14.5 8.2 11.5 18.0 16.2 2.2 -3.4 70.6 67.1
2020 15.0 9.1 12.8 17.8 18.1 2.3 -4.4 75.1 70.8
With Additional Measures Scenario
2008-12 12.7 7.1 10.2 18.2 13.9 2.0 -2.2 64.1 61.8
2015 10.7 6.9 9.7 18.0 14.8 1.8 -3.4 61.8 58.4
2020 9.4 6.6 9.8 17.8 16.0 1.4 -4.4 61.0 56.7
Numbers may not sum exactly due to rounding

Table 2. Historical and projected emissions for the non-ETS sector (Mtonnes CO2e) for With Measures and
With Additional Measures scenarios
Total
Non-ETS Sector Forest sinks
(With Forest sinks)
2005 48.3 - 48.3
2006 48.4 - 48.4
2007 48.4 - 48.4
With Measures Scenario
2010 47.9 -2.2 45.6
2015 50.5 -3.4 47.0
2020 53.8 -4.4 49.4
With Additional Measures Scenario
2010 46.4 -2.2 44.1
2015 45.9 -3.4 42.4
2020 46.0 -4.4 41.7

19