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Where next for the EU ETS?

Europe is taking decisive steps towards deeper mid-term climate targets. On 17 September 2020 the European Commission proposed that by 2030 the EU should aim to decarbonise by at least 55% relative to 1990. This would mean that in 2030 the European economy could emit 25% less than currently envisaged – a momentous upgrade of the existing goals.

The Emissions Trading Scheme (ETS) has been the cornerstone of Europe’s policy to address climate change and reduce emissions cost effectively. But now much of the effort to deliver the increased ambition will come from sectors currently outside of its scope: fuel use in buildings, road transport and maritime navigation. What role might the world’s largest carbon market have in achieving the European Commission’s new goals?

AFRY’s recent White Paper External link, opens in new window. started to address this question and now the Commission’s Impact Assessment has presented some options for the future of the EU ETS.

In a webinar on 13 October, Gareth Davies and Alex Luta discuss the main questions raised in the Commission’s Impact Assessment:

  • What does the increased ambition mean for the energy sector?
  • How might the ETS scope adjust to support the 55% target?
  • What are the impacts of different options for the ETS in terms of practical implementation and distributional effects?

The slide pack and recording are available on External link. or in our Insights External link. - exclusive to AIM report clients.

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