(CN) - The European Commission overstepped its authority when it rejected Poland and Estonia's greenhouse gas emissions plans and replaced their data with its own, thereby lowering the emissions allowances in each country, Europe's second-highest court ruled Wednesday.
Under a 2003 European cap-and-trade directive stemming from the 1997 Kyoto Protocol, members of the European Union must develop plans allocating carbon dioxide emissions within their respective countries.
The European Commission rejected plans developed by Poland and Estonia for 2008 to 2012, calling pre-2005 data used to calculate future emissions "less reliable" and claiming that the countries overinflated historic emissions in order to keep more carbon credits.
The commission replaced the data with its own, approving plans for Poland and Estonia that reduced the total annual emissions allowances by about 28 percent and 48 percent, respectively.
Poland and Estonia challenged the decisions. The Court of First Instance ruled that the commission, which was backed by the United Kingdom, had indeed exceeded its authority in rewriting the plans. It cited a slim "margin of manoeuvre" granting the commission the ability to review the plans.
The European Commission failed to adequately explain why the data weren't reliable, the court said, pointing out that other member states can provide their own data and even adjust the findings later.
The court annulled the rewritten plans and ordered the European Commission to pay Poland and Estonia's costs.
Six other Eastern European countries are reportedly challenging the rejection of their national allocation plans as well.
The Wall Street Journal reported that the ruling caused European carbon credit prices to sink by more than 4 percent.
World leaders are discussing climate change at a United Nations summit this week in Copenhagen, which many hope will provide an update to the Kyoto Protocol.
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