Sectoral Carbon budgets: an opportunity for effective climate & social policy

Under the Greek National Climate Law, electricity production, buildings and road transportation are among the seven sectors for which sectoral carbon budgets will be set up in 2024. These will determine the maximum greenhouse gas emissions per sector for the five-year period 2026-2030. With this as a starting point, in his article titled “Sectoral carbon budgets: an opportunity for effective climate & social policy“, published in a special feature by, Nikos Mantzaris explains the importance of this tool for an ambitious climate policy, in combination with the National Energy and Climate Plan (NECP) targets and the new European Emissions Trading System ETS 2.

On electricity production, Nikos Mantzaris suggests that the respective sectoral budget should be consistent with the NECP, according to which the carbon footprint of the sector will shrink to about 4 million tonnes of CO2 in 2030, practically down to zero in 2035. The main question raised here concerns the non-sustainable new fossil gas plants, given that its use in electricity generation will phase out by 2035.

Regarding buildings and road transportation – two sectors that have been stagnating in CO2 emissions in recent years – Nikos Mantzaris stresses that their inclusion in the new ETS 2 from 2027 is going to bring significant increase in the cost of fossil fuel consumption in these sectors. At the same time, the Social Climate Fund is designed to mitigate the social impact of the increasing prices. The challenge here is to avoid the policy of subsidies and invest instead in projects that get to the root of the problem. “Energy upgrades, heat pumps, self-production – individual or collective – of electricity from renewable energy sources, promotion of clean public transportation and electromobility are projects that should be subsidised, with priority given to the vulnerable,” the author notes, suggesting that this planning should be reflected in the respective sectoral carbon budgets.

The article was published on 22 December 2023, in the special feature of on the experience of 2023, the challenges and expectations of 2024.

The full feature is available on (in Greek).