During the course of the new European Commission mandate, Member States are expected to raise more than 200 billion in EU ETS revenues. Industry groups and governments are claiming these revenues to cover for their own costs, fill financial gaps, with little consideration to system needs and the principles guiding the ETS Directive. These revenues need to be spent wisely to achieve the most direct emission reduction and to shield vulnerable citizens from bearing excessively the costs of the transition.
This is why Carbon Market Watch, the Green Tank and 26 other organizations urge the new College of Commissioners to take up our recommendations on how to effectively use these revenues to guarantee they are invested for our citizens, society, and communities.
We are proposing:
- Amend the EU ETS Directive to ensure additionality and Do No Significant Harm principles are guiding the revenue spending;
- Focus on significant climate investments for industry, rather than carbon leakage protection, by phasing out all free allocation to increase the Innovation Fund, and end indirect cost compensation in the next ETS review;
- Support affordability of the necessary emission reductions for lower income groups through ETS2 revenues and expansion of the Social Climate Fund;
- Monitor Member States spending and enforce the earmarking foreseen by the ETS Directive.
The cost of financing the energy transition in Europe and globally should be borne by polluters, not by citizens.
You can see the letter we co-signed and sent to the Commission here.
