Climate change and global warming has become one of the main topics worldwide. The European Union Emission Trading System (EU ETS) was established to limit climate change, providing regulations which encourage companies to invest in cleaner production and more energy efficient production. Latvian energy intensive enterprises are operating under the EU ETS from the year 2005. The main goal of this paper is to provide an analysis of energy intensive installations in terms of their energy efficiency. Additionally, an analysis of EU ETS phase III which will start to operate in 2013 under new, more stringent rules has been conducted by modelling three Latvian energy intensive enterprise operations under this phase and estimating the barriers to meet the goal of the EU ETS phase III.