Ireland prepares to play dealmaker on EU’s biggest climate fight of the year

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

🗞️ Driving the news: Ireland assumes the role of broker in a high-stakes debate over the EU Emissions Trading System (ETS) as its presidency of the Council of the EU coincides with a major review of the policy
• Member states are divided between softening the ETS to shield industry and defending it to meet Europe’s climate targets

🔭 The context: The ETS, a 20-year-old cap-and-trade scheme, requires polluting industries to pay for emissions, generating over €250 billion historically
• Countries such as Poland, Italy, Czechia, and Austria want relief for industry, while Sweden, Denmark, Finland, and the Netherlands aim to preserve the system’s integrity
• The European Commission’s review, expected mid-July, may address free allowances, revenue redistribution, and a potential extension of the emission cap beyond 2039

🌍 Why it matters for the planet: The ETS is central to Europe’s decarbonisation pathway
• Weakening it risks higher industrial emissions, delaying the shift away from fossil fuels and undermining Europe’s contribution to limiting global temperature rise in line with Paris Agreement goals
• Decisions on free allowances and cap tightening will directly affect carbon emissions reduction trajectories

⏭️ What’s next: Ireland will navigate member-state negotiations to mediate compromises on the ETS
• The Commission is expected to release its review mid-July, after which months of political bargaining will determine whether industry protections dilute the system or whether stricter carbon pricing persists

💬 One quote: “There’s no baggage coming into this. So I think, we will operate as an efficient, honest broker through this.” – Darragh O’Brien, Ireland’s Minister of Energy and Transport

📈 One stat: The amount of €43 billion was generated last year from the sale of ETS allowances, a portion of which is earmarked for decarbonisation support and EU energy programs

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