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The proposal to review the EU Emissions Trading System (EU ETS) comes at a pivotal moment for Europe’s climate, industrial and economic policy.
Since its launch in 2005, the EU ETS has become the EU’s flagship climate instrument, helping to reduce emissions from the power sector, industry, aviation and maritime transport while generating more than €230 billion in auction revenues.
Emissions from sectors covered by the EU ETS have fallen by around 50% compared with 2005 levels, demonstrating the effectiveness of a robust, declining emissions cap combined with carbon pricing.
Europe faces heightened geopolitical uncertainty, growing international competition in industry and clean technologies, persistently high energy prices in parts of the economy, and significant investment needs in electricity grids, electrification and industrial decarbonisation.
