Ireland's EU presidency "places an added responsibility" on the Government to meet the March 31st deadline for submitting plans aimed at curbing carbon dioxide (CO2) emissions to Brussels for approval.
Addressing a conference on emissions trading in Dublin yesterday, the Minister for the Environment, Mr Cullen, said the introduction of such trading was a welcome move to a market-based approach to achieving environmental objectives.
But he conceded there were concerns in Ireland about the impact on competitiveness.
"I fully respect this concern and indeed have additional concerns, along with my Government colleagues, that sectoral equity be achieved," said Mr Cullen.
The preparation of Ireland's National Allocation Plan for emissions, in line with EU requirements, was a challenge both for policy makers and future participants in carbon trading, but he said political discussions would be "brought to finality very shortly".
Individual industries and other high energy users would have to be given sufficient notice of their allocation to be in a position to participate in the market; late notification will disadvantage them vis-à-vis competitor companies elsewhere in Europe.
Mr Cullen said that once a vigorous market in carbon emissions had placed a value on allowances, the primary responsibility would fall on industry to include in its cost base the price of CO2 emitted, and vigorously seek to reduce those costs.
"Given the importance of emissions trading in an EU context, our role as president during the national allocation publication and approval processes places an added responsibility on us to complete our end in a timely manner," Mr Cullen said.
He told the conference that the EU "attaches a high political importance to its global environmental and sustainable development leadership" and tackling climate change was the "litmus test" of this commitment.
Emissions trading would "maximise the level of our environmental ambition while ensuring that the costs for the most significant emitters . . . will be minimised through equal access to low cost reductions across a large, and growing, international marketplace."