Industry calls for substantial tightening of the EU Emissions Trading System
The European Council must advocate for structural reforms to the ETS and sustainable relief for energy-intensive businesses – limit price increases caused by the CBAM – balance climate protection and competitiveness
Ahead of this week’s European Council meeting, the Federation of Austrian Industries (IV) is once again calling for substantial improvements to the European Union Emissions Trading System (EU ETS). From the industry’s perspective, there is a need to extend free allocation for companies at risk of carbon leakage beyond 2034, to significantly slow the phase-out of this allocation starting as early as 2028, and to extend the ETS1 beyond 2039.
These changes are necessary to avert rapidly rising and ultimately excessive additional burdens on energy-intensive companies. However, they are also a prerequisite for limiting higher prices for imports of intermediate goods resulting from the European Carbon Border Adjustment Mechanism (CBAM) and thus ensuring the competitiveness of numerous manufacturing companies.
Commission President’s Position So Far Inadequate
The latest statements by EU Commission President Ursula von der Leyen miss the mark and fail to recognize key challenges by largely shifting responsibility to the member states. The structural adjustments to the ETS necessary for industry are apparently not yet on the EU Commission’s agenda.
“The European Commission is falling short of the demands of industrial reality. Emissions trading is the central instrument of European climate policy. What we need are clear European solutions, not the shifting of responsibility onto member states. Accordingly, we call on the European Council to address this highly relevant issue for our region and urge the Austrian federal government to take a corresponding stance,” emphasizes IV Secretary General Christoph Neumayer.
Joint Position of Central and Eastern European Employers’ Associations
For the IV and its sister associations from Central and Eastern Europe, which have formulated a joint position regarding the upcoming European Council, the focus is on competitive energy prices, tangible relief from regulatory requirements, and the sustainable strengthening of Europe as an industrial location. “Europe needs an industrial policy that combines climate protection and competitiveness. Long-term, sustainable solutions at the EU level are crucial for this, and we at the IV, together with our sister associations from Central and Eastern Europe, are advocating for this,” Neumayer concluded.