I propose to take Questions Nos. 9 and 12 together.
Among the positive signals for the environment, the EPA report, Ireland's Environment 2004, outlined a modest reduction in the emission of greenhouse gases. Emissions are down from 31% above 1990 levels in 2001 to 29% above in 2002, which is the first reduction in a decade. Ireland is pursuing a challenging programme to limit the growth in greenhouse gas emissions through the vigorous implementation of the Government's national climate change strategy. The strategy sets out a systematic programme to meet our Kyoto obligations by 2012. I initiated a review of the implementation of the strategy to ensure more focused and intensive implementation. This process is ongoing and incorporates an update of greenhouse gas emissions projections with a particular emphasis on cross-cutting economic instruments to achieve Ireland's Kyoto targets. These instruments include emissions trading and other flexible mechanisms which have continued to be developed at national, EU and international levels since the strategy was formulated.
The Government is ensuring that Irish industry and the power generation sector can participate fully in EU emissions trading starting in January 2005. In this context, the EPA has submitted the national allocation plan to the European Commission for approval. The installations included in emissions trading produce approximately one third of Irish greenhouse gas emissions. Emissions trading will enable these sectors to meet their reduction obligations in the most economically efficient manner through access to least-cost emissions reduction opportunities across the EU and more widely.
The study underpinning the development of the national allocation plan identified the overall national distance to target in the Kyoto period 2008 to 2012 at 9.2 million tonnes CO2 equivalent per annum. Achieving reductions of 4.3 million tonnes CO2 equivalent will be the responsibility of the emissions trading sector leaving reductions of 4.9 million tonnes CO2 equivalent to be achieved within the rest of the economy. I am satisfied that 1.2 million tonnes CO2 equivalent can be achieved within the sector of the economy outside emissions trading at or below a cost of €10 per tonne of CO2. The Government has indicated its intention to purchase 3.7 million allowances on the international market.
I am currently advancing the review of the overall national climate change strategy to take account of the foregoing decisions and I intend to publish the outcome in due course. I am satisfied that full implementation of the revised strategy over the remainder of the decade will ensure that our Kyoto obligations will be fully met in the 2008 to 2012 period. This will occur in the context of the arrangements for emissions trading together with any additional measures which may be identified in the review.