Emissions trading and carbon pricing: Recapping a busy week for green policy in the EU

(edie.net, 22 Dec 2022) One group of people who are showing no signs of slowing down this festive season are EU lawmakers. Here, we recap on three major green policy stories of this week, including landmark emissions trading and carbon pricing agreements.

Emissions Trading Scheme

After lengthy negotiations that seemed stuck at a crossroads this time last week, negotiators struck an agreementon reforms to the EU’s Emissions Trading Scheme (ETS) on Sunday (18 December). The ETS is the second-largest in the world, behind only China, covering more than 10,000 factories, refineries and power plants.

Under the ETS, facilities and companies conducting emission-intensive activities are set a cap on their emissions. Within this budget, organisations can trade allowances. Participants include electricity generators, cement manufacturers, steelworks, oil refineries and airlines.

Reforming the ETS was regarded as necessary in light of the EU strengthening its climate target, aiming now for a 55% reduction in annual emissions by 2030 on the road to carbon neutrality by 2050.

The deal on reform struck this week will see the scheme extending to cover more economic sectors. Negotiators agreed, for example, to create a separate emissions trading market for buildings and transport, which will launch in 2027. This is being dubbed ‘ETS2’.

External link

edie.net, 22 Dec 2022: Emissions trading and carbon pricing: Recapping a busy week for green policy in the EU