No price shock in 2024 / Still, more ambition than in the Commission proposal / EPP and Renew group propose compromise on EU ETS

“With our compromise amendment, we give industry and citizens more breathing space in difficult times and avoid a price shock in 2024. At the same time we still achieve more greenhouse gas reduction than in the Commission proposal.” This explained the Rapporteur on the EU ETS and spokesperson of the biggest political group in the European Parliament (EPP, Christian Democrats) Dr Peter Liese after a presentation of an amendment from his political group and the liberal Renew Europe group. While there was consensus between political groups on a lot of issues in the report on the biggest environmental law ever, the EU ETS including maritime, road transport and buildings, the ambition level was highly controversial. The Committee adopted by only 4 votes majority against the recommendation of Liese a steep increase of the ambition compared to the European Commission’s proposal. Instead of 61% proposed by the Commission which is the corresponding value to the net 55% target in the climate law, the Committee voted for 67% ambition. In particular problematic for the EPP and the rapporteur was the doubling of the so-called rebasing in 2024. “The Committee voted for taking out about 240 million allowances in 2024. This is twice as much as Commission has proposed and it would lead to an immediate price shock in times where we are already challenged with the need to be independent from Russian gas. Even though we all agree that renewable energies and energy efficiency are the future, we need to replace Russian gas also partly by coal, unfortunately, because the scale up will not be fast enough to over-compensate Russian gas already in 2024. That’s why we need breathing space for industry and consumers, in particular in a time where an economic crisis is more than likely. Therefore, we want a more even distribution of the efforts. I am very grateful that the Renew group compromised. The one-off-reduction will be only 70 million in 2024 and another 50 million will be taken out of the market in 2026. In adopting a higher linear reduction factor, we increase the ambition in 2030 to 63% and which is important also the overall emission between 2024 and 2030 are lower than in the Commission proposal so it is in any way more ambition.


On top of that, the EPP tabled the following amendments:

•    Together with S&D and Renew an amendment to re-establish the 2,5% top up of the Modernisation Fund for Central and Eastern Europe
•    A common amendment with S&D und Renew on the outermost regions.
•    A common amendment with S&D on carbon leakage protection for harbours.
•    An amendment on a bonus for sustainable alternative fuels in shipping and a derogation for ships carrying LNG and Hydrogen.
•    An amendment on restricting market access to avoid manipulation and speculation.
•    An amendment on exports in CBAM.
•    Very important is an amendment on benchmark derogations in particular to the steel sector.
•    On top of that the EPP tabled to all seven FitFor55 reports that are noted in plenary next week, an amendment for calling for regulatory moratorium in the light of the high energy and raw material prices and the war in Ukraine.

“The outcome of the ENVI vote was already very good. In 18 points, we improved the commission proposal substantially. If our compromise with Renew and hopefully some other amendments pass, the report will be even better. We want to decarbonize European Industry and not deindustrialize Europe. That is why those that invest, should be supported and those that do not understand that climate neutrality is a new normal, will feel a lot of pressure. ETS is the core of the European climate policy and will be substantially strengthened,” said Liese.