On Wednesday 29 April, the European Parliament adopted by a large majority (433 votes in favour, 120 against, 71 abstentions), and without amendment, the position of the Environment Committee (ENVI) on the proposal for a targeted revision of the market stability reserve for the ‘ETS 2’ CO2 emissions trading system extended to the building and road transport sectors (see EUROPE 13850/6).
MEPs believe that when the price of carbon exceeds €45/tonne of CO2 equivalent (2020 price), the European Commission should react to price peaks within the first month by mobilising emission allowances.
Instead of phasing out unused allowances transferred to the market stability reserve from January 2031, MEPs are advocating a gradual process whereby 50% of unused allowances would lapse on 1 January 2034, before being phased out completely at the beginning of 2036.
The European Commission has also been asked to consider whether the current cap of €45 per tonne of CO2 should be extended beyond 2029 and indexed to 2026 prices rather than 2020 prices.
To limit the potentially negative social repercussions of the ‘ETS 2’ system, MEPs propose that measures be considered to support households in their efforts to decarbonise. They argue that Member States could temporarily exempt residential housing if they have set specific targets for reducing CO2 emissions by 2030 (Regulation 2023/857).
See the European Parliament’s negotiating position: https://aeur.eu/f/lr2 (Original version in French by Mathieu Bion)