EP Industry Committee’s ETS vote to benefit Europe’s biggest polluters

Posted on 13 October 2016

With their vote today on the reform of the EU ETS, MEPs voted for measures that will benefit Europe’s biggest polluters, thereby failing to support Europe’s innovative clean tech sector.
With their vote today on the reform of the EU ETS for the period 2021-2030, the members of the the European Parliament’s Industry, Research and Energy (ITRE) Committee voted for measures that will benefit Europe’s biggest polluters, thereby failing to support Europe’s innovative clean tech sector.

“Today the members the Industry Committee showed their strong bias for supporting polluting companies rather than paving the way to a low carbon future”, said Imke Lübbeke, Head of Climate and Energy at WWF European Policy Office. “This is exactly the wrong signal to innovators and investors in the EU’s green economy.

“The EU ETS was set up to put a price on carbon pollution. Instead, the MEPs in this Committee not only offered more free pollution rides to industry but they also facilitated investments into coal fired power plants. They want to waste taxpayers money to subsidise more pollution, rather than investing in clean technologies, renewables and energy efficiency.”

With today’s vote, the members of the European Parliament’s ITRE Committee agreed to keep the EU ETS linear reduction factor at 2.2% - based on outdated October 2014 Council conclusions -, thereby completely neglecting Europe’s commitments to an ambitious Paris Climate Agreement.

On the positive side, MEPs agreed to cancel 300 million allowances from the market stability reserve. This cancellation represents a first step that will need to be reinforced taking into account that the overall surplus will keep growing until about 2 billion allowances on the market by 2020. MEPs also proposed an increase of the share of ETS auctioning revenues to be used for climate measures to 80% and the setting up of a Just Transition fund aimed at cushioning the social impact of climate policies .

“It is now up to the European Parliament’s Environment Committee to step in and turn EU ETS into an effective climate instrument. The European Parliament has been a strong proponent of an ambitious Paris Climate Agreement, complemented by meaningful domestic policies. It should now put its words into action and turn this ambition into real cuts in greenhouse gas emissions in Europe,”concluded Sam Van den plas, EU climate policy officer at WWF European Policy Office.

Today’s vote will be followed by a vote by the European Parliament’s Environment Committee on 8 December before the file is presented  to the Parliament’s plenary for final approval beginning of 2017. Afterwards, it will be subject to further negotiations with Member States.


Notes to the editors:

Yesterday, WWF launched  its 2030 Carbon Calculator. This innovative tool will help users to see the importance of credible climate policy instruments in Europe.  This online tool is designed for everyone to test and explore how different climate and energy policy options would impact Europe’s emissions  from 2021 onwards.

In particular we would like to draw your attention to the findings detailing how Europe’s carbon market can be made fit for purpose. The graphs below show the effect of the oversupply of EU ETS emission allowances, and the impact of different starting points on emissions reductions.

1) Cancellation of surplus ETS allowances:

Surplus allowances transferred to the Market Stability Reserve (MSR) will inflate the carbon budget of future ETS phases making it harder to achieve the objectives of the Paris Agreement. Surplus allowances should be dealt with in a permanent manner and eliminated from the Market Stability Reserve (MSR).

See our graph here

2. What should the starting point for the ETS be?

The ETS has a reduction target of 21% below 2005 levels by 2020 and will have to deliver a reduction of 43% in greenhouse gas emissions by 2030. In reality, CO2 emissions counted under the ETS are going down far faster than the reduction target. In the ETS sectors, emissions will already be reduced by 38% on 2005 levels by 2020. Therefore, ETS emission reductions after 2020 should be based on real and lower emissions levels.

See our graph here


Sam Van den plas
Climate Policy Officer
WWF European Policy Office
Mobile:  +32 485 95 22 01

Audrey Gueudet
Climate & Energy Senior Media and Communication Officer
WWF European Policy Office
Mobile: + 32 494 03 20 27
Human right to a healthy environment is at risk from growing pollution. Petrochemical plant on Teeside, UK.