CO2 emissions trading deadlocked

European leaders have set a target to cut CO2 emissions by 40 percent by 2030. There is currently a debate on how the next phase of the European Emissions Trading System (EU ETS) will look like starting in 2020.

The system includes a total of 31 European countries (28 EU member states plus Iceland, Liechtenstein and Norway). The main goal of reducing CO2 emissions is investing in low carbon technologies. There are significant differences in the EU regarding the proposed changes, as Slovakia, Poland and the Czech Republic have a high share of energy-intensive industries in GDP.

In the countries covered by the ETS, there is a fairly widespread opinion that the system should be changed, however, there is no consensus on how these changes should look. ETS has structural problems. The system is not economically efficient and does not attract investment. The EU needs a climate policy that sends appropriate, diversified investment signals to selected sectors.

The Director of the European office of ArcelorMittal in Brussels, in his assessment of the operation of the ETS, recalls that “The European Emissions Trading System is such that we cannot deal with it. We must balance future solutions to safeguard traditional industries. ”