EU ETS review proposal earmarks €160 billion for Europe’s largest polluters

Carbon Market Watch argues that the EU ETS review proposal prioritizes industrial interests over climate goals by earmarking at least €160 billion in free pollution permits after 2020. While the proposal increases the linear reduction factor to 2.2% to meet 2030 targets, the organization contends this is offset by the release of surplus allowances and the continuation of free allocations to prevent hypothetical carbon leakage.

• The EU ETS review proposal intends to provide pollution subsidies to industry totaling at least €160 billion after 2020, primarily through the free allocation of more than six billion pollution permits between 2021 and 2030 to mitigate the risk of carbon leakage.
• The proposal increases the linear reduction factor (LRF) from 1.74% to 2.2% from 2020 onwards to support the EU's 2030 climate target of at least 40% reductions. However, Carbon Market Watch notes that the Commission's own analysis suggests an LRF of at least 2.4% is required to meet long-term 2050 objectives.
• The review proposes that approximately 40% of total EU ETS allowances be given for free to industrial sectors, with an absolute majority of sectors (representing about 95% of industry emissions) receiving 100% free allocation after 2020, an increase from the 30% stipulated in the current directive.
• The proposal weakens existing provisions by allowing 250 million surplus allowances from the Market Stability Reserve and 100-150 million allowances from the cross-sectoral correction factor to be used for new entrants and production increases, potentially adding up to 400 million allowances to the market during 2021-2030.
• Ten lower-income Member States, including Poland, are permitted to continue granting free pollution permits to carbon-intensive power producers from 2021 to 2030, extending a measure that was originally intended to be phased out by 2020.

APA

CMW (2015). EU ETS review proposal earmarks €160 billion for Europe’s largest polluters. Carbon Market Watch. https://carbonmarketwatch.org/2015/07/15/media-statement-eu-ets-review-proposal-earmarks-e160-billion-for-europes-largest-polluters/

Chicago

CMW. EU ETS review proposal earmarks €160 billion for Europe’s largest polluters. Carbon Market Watch, 2015. https://carbonmarketwatch.org/2015/07/15/media-statement-eu-ets-review-proposal-earmarks-e160-billion-for-europes-largest-polluters/.

Wikipedia

{{cite press release |last1=CMW |title=EU ETS review proposal earmarks €160 billion for Europe’s largest polluters |publisher=Carbon Market Watch |date=15 July 2015 |url=https://carbonmarketwatch.org/2015/07/15/media-statement-eu-ets-review-proposal-earmarks-e160-billion-for-europes-largest-polluters/ |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@misc{cmw2015ets, author = {CMW}, title = {{EU ETS review proposal earmarks €160 billion for Europe’s largest polluters}}, publisher = {Carbon Market Watch}, year = {2015}, month = jul, url = {https://carbonmarketwatch.org/2015/07/15/media-statement-eu-ets-review-proposal-earmarks-e160-billion-for-europes-largest-polluters/}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }