EU Emissions Trading System: landmark agreement between Parliament and Council delivers on EU's commitment to turn Paris Agreement into reality
The European Parliament and Council have today reached a provisional agreement to revise the EU Emissions Trading System (EU ETS) for the period after 2020. This revision will contribute to put the EU on track to achieving a significant part of its commitment under the Paris Agreement to reduce greenhouse gas emissions by at least 40% by 2030. The EU Emissions Trading Scheme puts a cap on the carbon dioxide (CO2) emitted by more than 11,000 installations in the power sector and energy intensive industry through a market-based cap and trade system. The deal includes:-
- Significant changes to the system in order to speed up emissions reductions and strengthen the Market Stability Reserve to speed up the reduction of the current oversupply of allowances on the carbon market;
- Additional safeguards to provide European industry with extra protection, if needed, against the risk of carbon leakage;
- Several support mechanisms to help the industry and the power sectors meet the innovation and investment challenges of the transition to a low-carbon economy.
With final approval from the European Parliament and the Council, the revised EU ETS Directive will be published in the Official Journal of the Union and enters into force 20 days after publication.