EU lawmakers fail to fix Europe’s broken carbon market

Carbon Market Watch argues that the European Parliament's industry committee has failed to fix fundamental flaws in the EU ETS, specifically regarding the oversupply of pollution permits and the continued provision of free allowances to heavy industry. While the committee strengthened exclusions for future coal investments and permanently cancelled a small portion of surplus allowances, the organisation contends these measures are insufficient to drive a low-carbon transition or meet Paris Agreement commitments.

• The European Parliament's industry committee maintained the EU ETS ambition levels from a Commission proposal that predates the Paris Agreement, failing to reflect new global climate commitments.
• The EU ETS suffers from a significant oversupply of pollution permits, which has resulted in an inadequate carbon price of approximately 5 euros per tonne.
• The industry committee proposed increasing the distribution of free pollution permits to subsidise heavy industry, with support for low-carbon innovation remaining 10 times lower than pollution subsidies.
• The industry committee strengthened the proposal to exclude future coal investments from an exemption that allows low-income member states to provide free permits to energy providers, a mechanism previously used to subsidise coal plants.
• A small portion of surplus allowances from the Market Stability Reserve will be permanently cancelled, though this is described as a minor measure relative to the total oversupply.

APA

Amaral, K. (2016). EU lawmakers fail to fix Europe’s broken carbon market. Carbon Market Watch. https://carbonmarketwatch.org/2016/10/13/press-statement-eu-lawmakers-fail-to-fix-europes-broken-carbon-market/

Chicago

Amaral, Kaisa. EU lawmakers fail to fix Europe’s broken carbon market. Carbon Market Watch, 2016. https://carbonmarketwatch.org/2016/10/13/press-statement-eu-lawmakers-fail-to-fix-europes-broken-carbon-market/.

Wikipedia

{{cite press release |last1=Amaral |first1=Kaisa |title=EU lawmakers fail to fix Europe’s broken carbon market |publisher=Carbon Market Watch |date=13 October 2016 |url=https://carbonmarketwatch.org/2016/10/13/press-statement-eu-lawmakers-fail-to-fix-europes-broken-carbon-market/ |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@misc{amaral2016lawmakers, author = {Amaral, Kaisa}, title = {{EU lawmakers fail to fix Europe’s broken carbon market}}, publisher = {Carbon Market Watch}, year = {2016}, month = oct, url = {https://carbonmarketwatch.org/2016/10/13/press-statement-eu-lawmakers-fail-to-fix-europes-broken-carbon-market/}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }