IV Welcomes Initiative to Reform the EU Emissions Trading System

The Federation of Austrian Industries (IV) expressly welcomes the initiative by Federal Chancellor Christian Stocker and other European heads of government to review the EU Emissions Trading System (ETS). “The call for a flattening of the current reduction trajectory and for an extension of free allowances addresses key concerns of energy-intensive industries. In light of high energy prices and increasing global distortions of competition, an adjustment of the system is necessary to prevent the migration of production and value creation out of Europe,” comments IV Secretary General Christoph Neumayer.

From the IV’s perspective, structural reforms are now needed at the European level to reconcile climate protection with competitiveness. These include, in particular, an extension of the free allocation of CO2 allowances for particularly affected sectors beyond 2034, a significantly slower phase-out of this allocation starting as early as 2028, and an extension of the ETS1 beyond 2039.

This predictable transition is important in order to avert additional burdens on an industry already under massive pressure and to limit additional costs resulting from the Carbon Border Adjustment Mechanism (CBAM). The upcoming European Council is called upon to send clear signals regarding industrial policy and to ensure sustainable relief.