The Member States’ ambassadors to the European Union (Coreper) held an exchange of views, on Wednesday 28 April,to clarify the scope of the forthcoming discussion by the 27 Heads of State or Government on climate change, which will be held on 25 May during an EU summit (see EUROPE 12705/27).
The last discussion on the climate issue in the European Council format was on 10-11 December 2020. At the summit, the EU27 leaders agreed to aim for a net reduction in the EU’s greenhouse gas (GHG) emissions of at least 55% by 2030 compared to 1990 levels (see EUROPE 12621/1).
But the European Council also agreed to return to the climate issue before the Commission presents its ‘Fit for 55’ package of legislative initiatives (due in June), and in particular the future of the EU regulation (2018/842) setting emission reduction targets for each Member State for sectors not covered by the EU Emissions Trading Scheme (Effort Sharing Regulation - ESR).
Taking into account the guidance provided by the European Council, the European Commission has sent a ‘non-paper’ to the ambassadors to ‘frame’ the process.
Consulted by EUROPE, the paper points out that “the first issue to address is the question of the future scope of the ESR”, as the “potential application” of the ETS to sectors such as buildings and road transport “would cover around half of the emissions of today's Effort Sharing regulation”.
While GHG emissions from these two sectors are currently dealt with under the ESR Regulation, the Commission is considering including these sectors in the ETS. This currently covers large emitters such as the energy sector and industry, as well as intra-EU aviation. Together, these sectors account for about 40% of EU emissions, with the remaining 60% coming from the sectors covered by the ESR Regulation.
According to the Commission, the potential application of the ETS to the buildings and road transport sectors “will have to be examined in light of its ability to provide an additional incentive to actors in these sectors to take additional actions”. The institution added: “At the same time, this would have to happen gradually, in a manner that does not lead to disruption of these sectors, and does not interfere with the carbon price in the current ETS”.
The Commission document also states that the extension of the ETS to other sectors “will generate additional resources for supporting the transition”.
The text also stresses the importance of equity and cost-effectiveness, which “remain key principles for the effort sharing regulation”.
“This would include a target setting approach that takes into account differences in capacity to act (based on GDP per capita, as before) while considering adjustments taking into account the cost-effective potential in all Member States”, the Commission says.
At the time of going to press, the ambassadors' meeting had not yet finished. (Original version in French by Damien Genicot)