EU criticised over major shakeup of its flagship emissions policy

illuminem summarises for you the essential news of the day, reviewed by our editorial team. Read the full piece on Euronews or enjoy below:

🗞️ Driving the news: The EU has unveiled a revision of its Emissions Trading System (ETS), extending free carbon permits until 2038 and partially delaying the phase-out of allowances
• Critics warn the changes favor polluters, potentially slowing decarbonization while endangering Europe’s climate goals for 2040

🔭 The context: The ETS has cut emissions by 50% in covered sectors since 2005 and generated €270 billion for green innovation and energy modernization
• The reform offers 80% of free permits upfront for companies with decarbonization plans, with the remaining 20% contingent on completed investments
• The ETS will also start pricing some flights within 5,000 km from 2029, but 47% of aviation emissions remain exempt

🌍 Why it matters for the planet: Delaying emission reductions risks making the EU’s 2040 target more expensive and undermines innovation in low-carbon technologies
• It could also weaken Europe’s global climate leadership and the credibility of carbon pricing as a climate tool

⏭️ What’s next: Member states and NGOs are poised to push for stricter implementation and gradual expansion of coverage, especially in aviation and shipping
• The Commission plans to allocate 110 million ETS allowances to accelerate clean shipping fuels and battery-powered vessels

💬 One quote: “It looks like a gift for companies to delay their emission reductions while in reality this puts them at a competitive disadvantage with Chinese companies that accelerate.” — Linda Kalcker, Strategic Perspectives

📈 One stat: 47% of European aviation emissions will remain exempt from ETS carbon pricing under the current plan

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