HKS includes electricity and heat producers and energy-intensive industries. The trading system ensures that about 10,000 energy-intensive industrial plants and power plants from all Member States, plus companies from Iceland, Norway and Liechtenstein. The aviation activities of EU countries also belong to the EU ETS. From 2024, the EU ETS has been extended to maritime transport as well.
The maritime transport sector has been included in the EU Emissions Trading System (EU ETS) since 1 January 2024
The EU greenhouse gas emission trading system
The Member States of the European Union, which ratified the Paris Agreement on climate change, committed to reducing greenhouse gas emissions by 40% by 2030 compared to 1990.
The European Union Emissions Trading System (hereinafter “the trading system” or EU ETS) will help reach this goal, the emissions of participating installations must decrease by 43% compared to 2005.
The EU ETS was established by Directive 2003/87/EC of the European Parliament and of the Council (hereinafter referred to as the EU ETS Directive). The trading system became operational in 2005 and is a cornerstone of the EU climate policy. The cap is set for emissions in EU ETS, which is reduced annually and as a result, emissions are reducing. The EU ETS is based on a cap and trade system. So far, it has been the most effective and cost-effective method of reducing emissions from installations as it gives companies flexibility to reduce emissions.
The EU ETS regulates about 45% of the greenhouse gas emissions of the European Union. The system includes approximately 11,000 energy-intensive industrial plants and power plants from all Member States as well as companies from Iceland, Norway and Liechtenstein. Aviation activities in the EU and the listed countries are also part of EU ETS.
The following greenhouse gases and sectors are covered by the EU ETS:
Carbon dioxide (CO2) in the energy and heat production sector and in energy-intensive industrial sectors such as refining, cement, lime, glass, paper and cardboard and fertiliser production, as well as in aviation
Dinitrogen oxide (N2O) in the production of nitrogen, adipic and glycosyl acids and glycosal
Perfluorocarbons (PFC) in the production of aluminium.
Meeting the requirements of EU ETS is mandatory for companies operating in these sectors. In some sectors, only installations with a certain rated thermal input and production levels need to be part of EU ETS.
Installations, the activities of which comply with the requirements provided for in § 2 of Regulation No. 134 opens in a new tab of the Government of the Republic of 10 August 2018, are part of EU ETS in Estonia. Estonian installations in the system are part of the following sectors:
Energy production
Refining of mineral oil
Lime production
Production of glass
Pulp production
Production of paper or cardboard
Production of ceramic products.
Trading system permit and reporting
Installation as part of the EU ETS
All installations in the European Union greenhouse gas emission trading system (EU ETS) must report and comply with the rules established in the EU ETS Directive, the Monitoring and Reporting Regulation and the Regulation on Verification and Accreditation.
All companies belonging to the EU ETS must have an account in the emissions trading registry and, in this regard, comply with the regulation of the registry. The inclusion of an installation in the EU ETS is decided in accordance with Annex I of the EU ETS Directive, which defines the fields of activities covered by the trading system. The Guidance Document of the European Commission (PDF) provides additional information on the interpretation of the fields of activities of Annex I.
Trading system permit and monitoring plan
The Environmental Board gives an operator of a stationary emission source the right to release greenhouse gases into the atmosphere from an installation or any part thereof as a part of the environmental permit or integrated environmental permit specified in §40 (1) of the General Part of the Environmental Code Act (hereinafter trading system permit). All installations belonging to the EU ETS are obliged to have a trading system permit, and all installations must also have a monitoring plan. The application for a new environmental permit or integrated environmental permit or changing the existing permit is arranged in the information system KOTKAS.
The operator must continuously monitor that the trading system permit is in compliance with the actual circumstances and inform of any changes affecting the trading system permit (including the monitoring plan):
Changes in the information entered on the permit (e.g. contact details)
Changes in monitoring methods (official letter with revised monitoring plan)
Changes in capacity and/or activity level (official letter)
Suspension of production for more than six months (official letter) and subsequent restoration of production (official letter)
Change of the owner (official letter)
Merger, split and restructuring of the parts of an installation (official letter with the corresponding application form).
Annual circle of EU ETS for an operator
1 January
Emission monitoring at the installation is started in accordance with the approved monitoring plan.25 March
The operator submits emissions report for the previous year and the verification report prepared by the verifier.
The operator enters the last year's emissions in the trading registry and the verifier confirms it.
The operator whose emission allowances are allocated free of charge, submits an annual activity level report for the previous calendar year with the verification report (info@keskkonnaamet.ee).30 June
The Environmental Board allocates free of charge emission allowances to the installation account in the trading registry pursuant to the amount established in Article 10a of the EU ETS Directive.
The operator submits a correction report (according to the size of the installation each year, every two years or every four years).30 September
The operator surrenders the quantity of emission allowances permitted in the trading registry in accordance with the approved quantity of emissions for the previous calendar year.
If the emission allowances are not returned on time, a fine of 100 EUR/t must be paid in addition to the surrendering.31 December (and on an ongoing basis)
The operator notifies the competent authority of the changes.
The operator should notify the administrator of the trading registry (khgregister@keskkonnaamet.ee) of any changes in the data of the registry account within 10 days.
At the end of the year, the operator will review the account and, if necessary, notify of the changes or confirm to the registry administrator that the account is up-to-date.
Significant changes in the monitoring plan, suspension and termination of the activity must be addressed to annika.konovalov@keskkonnaamet.ee.
Emission allowances
Free emission allowances can be applied for by industrial and district heating companies (Article 10a of the Trading Directive).
Emission allowance is the trading currency of the EU ETS. One emission allowance gives the installation a right to emit one ton of CO2. In addition to district heating companies, free emission allowances can be applied for by those companies that are at risk of competition compared to third countries that do not have as stringent requirements for operating companies, and higher taxes would jeopardise the transfer of installations to countries with lower environmental requirements and thereby not reduce emissions. This is called carbon leakage in short.
Companies that are not allocated free emission allowances or they do not have enough to meet the annual surrender obligations will have to buy the deficit on the trading market or switch to more efficient technologies, which would lead to a reduction in emissions. However, if an operator needs fewer allowances than it has on the account of the trading registry, it may sell the surplus.
Annual surrender obligation means that companies have to surrender a number of emission allowances, equal to the verified emissions report of the preceding calendar year, in the trading registry by 30 September each year. The cap for the emissions and the valuation of every tonne of emissions saved will lead companies participating in the EU ETS to invest in more efficient low-carbon technologies.
Reporting
By 25 March each year, operators belonging to the EU ETS submit an emissions report and a verification report and an annual activity level report together with a verification report to the Environmental Board.
Operators must submit a report on improvements to the monitoring methodology by 30 June either annually (category C), every two years (category B) or every four years (category A) (Article 69 of the Regulation on Monitoring and Reporting).
the Environmental Board will introduce a new reporting system as from the 4th trading period.
All operators must submit monitoring plans in the new reporting system by 31 December 2021 at the latest. Emission reports, verification reports of emission reports and correction reports will be also submitted in the new reporting system. The submission and processing of other documents and reports will continue as usual by e-mail.
Verification of a report
A verifier, with relevant accreditation, must check the report prepared by the operator in EU ETS. Information on accredited verifiers of EU ETS can be found on the website of the Estonian Accreditation Centre. In addition, verifiers who have received accreditation in other Member States can also work as verifiers in Estonia.
Compliance status
The following tabels provide an overview of Estonian installations and their emissions in 3rd and 4th trading period:
EU ETS registry
Transactions (e.g. the purchase and sale of allowances) in the European Union Greenhouse Gas Emissions Trading System (hereinafter EU ETS) are performed via an electronic registry that is common in all Europe (European Union Community Registry, EUCR). All national registries are connected to the International Transaction Log (ITL) and the European Union Transaction Log (EUTL), which check the issuance, transfer, surrender and cancellation of emission allowances. Registries and transaction logs store information about deposits and transactions on holding accounts.
The registry has been established in accordance with the EU ETS Directive and Article 6 of the European Commission Decision 280/2004/EC. The registry is managed and operations are carried out in accordance with Regulation (EU) 2019/1122 of the European Commission (hereinafter the Regulation of the Registry).
Companies participating in EU ETS must have an account in the trading registry to obtain emission allowances allocated free and to surrender emission allowances. Persons and companies who would like to participate in trading the emission allowances must also have an account in the trading registry. The registry includes holding accounts of stationary operators, holding accounts of aircraft operators and trading accounts.
Allowances valid during the trading period can be held on holding accounts and transfers can be made to other accounts of the registry.
The registry includes holding accounts of stationary operators, holding accounts of aircraft operators and trading accounts.
to the registryAs from 28 October 2016, the registry can be signed in through the EU Login system. This was previously done through the European Commission Authentication System, i.e. ECAS. Those who have an ECAS account do not need to make any changes, but in the future, only their email address can be used for logging in (it is no longer possible to log in with the username). The EU Login tutorial in the conditions of use of the registry referred to below will help new users.
Accounts of EU ETS REGISTRY
All operators of installations belonging to EU ETS must have an operator holding account (OHA). This is necessary so that they can be allocated free emission allowances and that they can enter their installation emissions and surrender emission allowances within the limit of emissions referred to in the emissions report of the company. The account can also be used to make transfers. Having an operator holding account is mandatory for companies that need to participate in EU ETS.
An aircraft operator holding account (AOHA) works on the same principle as the operator holding account.
Having an aircraft operator holding account is mandatory for companies that need to participate in EU ETS.
Maritime operator holding account (MOHA) works on the same principle as the operator holding account.
Having a maritime operator holding account is mandatory for companies that need to participate in EU ETS.
A trading account (TA) is intended for those who trade frequently. Owning a trading account is voluntary and both legal and natural persons can apply for opening it.
If you have any questions, please contact Estonian Registry Administrator:
Mr. Mihkel Toom
khgregister@keskkonnaamet.ee
phone +372 5918 2731
Authorised representatives
All accounts in the registry must have at least two account representatives (AR). An account representative initiates transactions and other processes on behalf of the account holder (e.g. company). An account representative may also be granted access to the account only with the viewing rights.
Read more:
Registri määruse artiklist 20 (Article 20 of the Regulation of the Registry)
Reporting on changes
Account holders must notify the administrator of the registry (khgregister@keskkonnaamet.ee), within 10 working days, of the changes in the information related to the account, including changes with regard to account representatives (Article 22 of the Regulation of the Registry).
Performing transactions in the registry
The easiest way is to make transfers to accounts on the trusted accounts list. Accounts held by the same account holder shall be automatically included on the trusted account list and it is possible to add there holding account numbers of other transaction partners. The change shall be initiated and approved by two authorised representatives entitled to initiate and approve processes respectively. The execution of the proposed change shall be immediate for the deletion of accounts from the trusted account list. For all other changes to the trusted account list the execution shall take place at 12.00 Central European Time (CET) on the fourth working day following the proposal. Transactions are initiated between 11:00 and 17:00 from Monday to Friday (incl.) (except public holidays in the Member States).
Registry fees:
As of 2016, a state fee of 300 euros shall be paid for reviewing the application for opening a trading account. As of 2014, a state fee of 320 euros shall be paid for the maintenance of the trading account every year, which is paid by 15 January of the current year (§120 of the State Fees Act).
Last updated: 02.07.2026
