EU’s new carbon market is set to slash CO2 with soaring prices for home heating

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🗞️ Driving the news: A new EU carbon market for transportation and gas-fired heating is set to launch in two years, potentially driving up household costs
• BloombergNEF predicts the carbon price could reach €149 per metric ton by 2029—more than double today’s rate for power plants and industry
• Some EU politicians are pushing for a delay due to the financial burden on consumers

🔭 The context: The new emissions trading system aims to cut CO2 by making polluting energy sources more expensive, encouraging cleaner alternatives like heat pumps and EVs
• Fuel suppliers will bear the direct costs but are expected to pass them on to consumers
• The initiative comes amid Europe's ongoing recovery from the energy crisis

🌍 Why it matters for the planet: By making fossil fuel-based heating and transport more costly, the EU hopes to accelerate the energy transition and meet climate targets
• However, high costs could disproportionately affect households and small businesses
• This raises concerns about balancing climate action with economic hardship

⏭️ What's next: If the market proceeds as planned, heating bills could rise by 41%, and transportation costs by 27%, per BNEF estimates
• Political pressure for a delay or compensation measures may grow as implementation nears
• Policymakers must navigate affordability concerns while ensuring climate goals remain on track

💬 One quote: “Ambitious targets and high costs risk making households and small businesses the losers.” – BloombergNEF report

📈 One stat: The EU carbon price for transportation and heating could hit €149 per metric ton by 2029—over twice the current level

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