This evening in the European Parliament, MEPs debated plans to reform the EU’s Emissions Trading System (ETS), a scheme set up in 2005 to help reduce greenhouse gas emissions.

The proposals are a response to the failure of the ETS to act as a serious incentive for industry to reduce CO2 emissions. Under the current scheme, carbon credits, the permits that companies must buy to offset their emissions, are too cheap and too many have been issued.

While the compromise text agreed on by the Committee on the Environment, Public Health and Food Safety (ENVI) is an improvement on the Commission’s proposal – with more ambitious environmental targets – amendments expected from the centre-right at the plenary vote may dilute those gains. 

GUE/NGL MEP Kateřina Konečná appealed for a strong Parliament mandate ahead of the trialogue negotiations with the Council:

“Our negotiations were lengthy but showed that cooperation is possible for a common purpose, based on facts and the specifics of the proposals. While the final text agreed in the Committee is not ideal, some proposals are positive: an 800-million reduction in the number of carbon credits and an increase in their price as well as less reliance on the ETS.” 

“On the other hand, measures to protect European industry are not ideal. In the end we should be able to continue our cooperation and maintain this compromise to give Parliament a strong mandate during the negotiations for the Directive with the Council,” the Czech MEP urged. 

The EU is the world's third largest CO2 emitter but it also boasts the most ambitious climate target: to cut emissions by at least 40 per cent by 2030 compared to 1990 levels.

Greek MEP Sofia Sakorafa highlighted three critical problems with the proposals to remove specific sectors from the carbon leakage list and with the import inclusion scheme, which has lacked clarity: 

“Removing the cement industry from the list would lead to a competitive disadvantage for European cement producers in export markets, vis-à-vis countries, exporters and local cement players not subjected to similar CO2 constraints. The Greek cement industry in particular, employing 13 000 workers and with a trade intensity of 45 per cent – way beyond the threshold of 10 per cent – would be condemned to decline and extinction.”

“The year 2015 or at most 2014 should be used as the reference year for project eligibility under the newly created Modernisation Fund in order to reflect the current economic reality in member states,” Sakorafa continued.    

“Regarding the inclusion of the shipping sector in the ETS, I must underline that introducing legislation at a regional level may have an adverse impact on the sector at EU level.  Our goal should be the establishment of a system at the level of the International Maritime Organisation,” the Greek MEP concluded.