University buys emission rights to throw them away


One company saving on its energy consumption simply means that another company can use more energy. As Radboud University doesn’t think this is a particularly sustainable system, it has decided to make a surprising move.

Emission rights…?

The European Union tries to stimulate companies to save energy. One of the ways in which they do this is by creating a trading system for CO2 emission. Every company is allowed a certain amount of CO2 emission. If you remain below your own threshold, you can sell your emission rights to other companies whose production cycle forces them to emit more CO2.

Wait a minute! Radboud University is not a company. Is it?

No. This is not actually just about the university, but about the university and Radboud university medical center, operating jointly under the umbrella organisation Stichting Katholieke Universiteit (‘Catholic University Foundation’). The university and the medical centre purchase their energy together. The energy amounts involved are such that Radboud University is forced to take part in the emission trading system. Company or no company.

So what’s the surprising move?

Radboud University works hard to reduce its energy consumption. We use more and more sustainable energy sources. Our buildings are increasingly heated with residual heat, for example from the HFML magnet lab. Within the emission trading system, this means that the university is actually enabling other companies to emit more CO2, since we require fewer emission rights. We don’t like that, which is why we’ve decided to continue to purchase emission rights for the value of our CO2 energy savings (even if we don’t need them). In this way, we remove these emission rights from the market.

So the university is buying emission rights for the pleasure of shredding them. Kind of like buying three bottles of Coca Cola only to empty them in the sink, so that no one else can drink them.

Something like that, yes. But, in the words of energy coordinator Toon Buiting, this is not a random move. The university wishes to start a debate in society concerning the emission trading system. Buiting explains that as a result of the crisis, since 2008, companies have been using less energy. This has resulted to a surplus of emission rights, and therefore lower emission prices. From the point of view of climate change, this is not particularly good news: after all, ‘we’ already face hurricanes, floods and rising temperatures.

So how expensive is this “move”?

On the current market, the emission rights we’ve removed from the market are worth €6000. But, once the crisis is over, companies will start to produce more; so ultimately, our rights might be worth €16,000. On a yearly basis.

Is that a lot of money?

On a university budget, it’s not a significant amount. Nor will it create a shock effect on the emission market. According to Buiting, the university is just a little Tom Thumb compared to giants such as Tata Steel. We have no ambitions to turn the market on its head. But, as Buiting says, it’s an important signal. Let the debate begin!

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