The European Commission is preparing to propose changes to the European Union's Emissions Trading System (ETS) that would extend the allocation of free emission quotas to industrial sectors in exchange for commitments to invest in the EU, according to an internal Commission document seen by Reuters.
Free quotas related to competitiveness issuesEnergy-intensive industries currently receive a portion of their emissions quotas for free to help them remain competitive with producers in regions without comparable carbon costs.
Although the EU had previously planned to phase out free allocations as part of its decarbonization strategy, pressure from several industries and member States led to consideration of maintaining support measures aimed at protecting the competitiveness of European producers.
The European Commission is expected to submit its proposal for the revision of the ETS on July 15. According to the document, the review will also require EU member states to allocate a large share of ETS revenues to support decarbonization of industries covered by the system.
A broader review of ETS mechanisms is planned
The review is also expected to include more
