EU ETS revenues from polluters to the people

A joint letter from various organisations calling for a 'people first' approach to EU ETS revenues, recommending stricter earmarking rules to prevent fossil fuel lock-in, the phase-out of free allowances for polluters, and the expansion of the Social Climate Fund to protect vulnerable citizens from ETS2 costs.

• The EU ETS generated €43.6 billion in 2023, with member states projected to raise over €193 billion between 2024 and 2030 from auctioning allowances for industry, power, shipping, and aviation. An additional €260 billion is expected between 2027 and 2032 from the new ETS2, which covers road transport and buildings.
• Current earmarking rules under Article 10(3) of the EU ETS Directive are described as containing outdated spending actions that allow for fossil fuel lock-in, such as investments in Carbon Capture and Storage for coal-fired power plants and infrastructure to switch from coal to gas.
• The document argues that free allowances still cover half of total emissions under the EU ETS, noting that in 2023, the steel sector received over 35 million excess allowances, the cement sector covered all its emissions with free allowances, and the fertilisers industry received 4 million.
• The Social Climate Fund (SCF), intended to mitigate the impact of ETS2 on vulnerable groups, is capped at €86.7 billion and is deemed insufficient to offset the impact of ETS2 as prices rise.
• The authors recommend that the EU increase its international climate finance commitments by using carbon market revenues to support adaptation and climate actions in vulnerable third countries.
• Recommendations for the next EU ETS review include amending Article 10(3) to incorporate the 'Do No Significant Harm' principle, banning all fossil fuel subsidies, and ensuring that ETS revenues supplement rather than replace national funding.

APA

Carbon Market Watch (2024). EU ETS revenues from polluters to the people. https://carbonmarketwatch.org/wp-content/uploads/2024/12/CMW-Joint-letter-on-ETS-revenues.pdf

Chicago

Carbon Market Watch. EU ETS revenues from polluters to the people. 2024. https://carbonmarketwatch.org/wp-content/uploads/2024/12/CMW-Joint-letter-on-ETS-revenues.pdf.

Wikipedia

{{cite press release |author=Carbon Market Watch |title=EU ETS revenues from polluters to the people |date=December 2024 |url=https://carbonmarketwatch.org/wp-content/uploads/2024/12/CMW-Joint-letter-on-ETS-revenues.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@misc{carbonmarketwatch2024ets, author = {{Carbon Market Watch}}, title = {{EU ETS revenues from polluters to the people}}, publisher = {Carbon Market Watch}, year = {2024}, month = dec, url = {https://carbonmarketwatch.org/wp-content/uploads/2024/12/CMW-Joint-letter-on-ETS-revenues.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }