“The EU’s climate policy approach must be adjusted to reflect the new reality” in particular the war in Middle East and rising energy prices. That is the request made by Greece, Czech Republic, Poland and Romania in a letter ahead of the ‘Competitiveness’ Council to be held in Brussels on Thursday 28 May.
The four delegations want to discuss there the impact of the European Union Emissions Trading System on energy-intensive industries. They are calling for realistic adjustments to “benchmark values” of the EU ETS for the period from 2026 to 2030.
On 10 May, the European Commission announced an update of these benchmark values, which make it possible to grant free allowances to 10% of installations performing best in terms of their CO2 emissions (see EUROPE 13866/6).
This provides for the free allocation of allowances to be gradually phased out after 2026, from 30% to 0% in 2030, for sectors less exposed to risks of relocation outside the EU. The sectors most exposed will receive 100% of their allocations free of charge.
Free allowances. The four delegations propose abolishing the allocation of free allowances to companies outside the EU and revising the coefficient of the Carbon Border Adjustment Mechanism (CBAM). At same time, they are calling for an increase in the allocation of free allowances for European energy-intensive companies, in order to encourage, for example, investment in industrial decarbonisation.
Lastly, they are asking for access to more European funding for low-income Member States or those historically dependent on emission-intensive industries, as well as compensation for indirect costs of the EU ETS.
A revamp of the system by the Commission is planned for 15 July.
To read the letter: https://aeur.eu/f/m1l (Original version in French by Nadège Delépine)