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– EU member states and parliamentarians on Sunday announced an agreement for a major reform to the bloc’s carbon market, the central plank of its ambitions to reduce emissions and invest in climate-friendly technologies.
The deal aims to accelerate emissions cuts, phase out free allowances to industries and targets fuel emissions from the building and road transport sectors, according to a European Parliament statement.
The EU Emissions Trading System (ETS) allows electricity producers and industries with high energy demands such as steel and cement to purchase “free allowances” to cover their carbon emissions under a “polluter pays” principle.
The quotas are designed to decrease over time to encourage them to emit less and invest in greener technologies as part of the European Union’s ultimate aim of achieving carbon neutrality.
Negotiators representing member states and the parliament had spent more than 24 hours in intense talks before reaching an agreement on Saturday night that widens the scope of the carbon market.
The deal means emissions in the ETS sectors are to be cut by 62 percent by 2030 based on 2005 levels, up from a previous goal of 43 percent. Concerned industries must cut their emissions by that amount.
The agreement also seeks to accelerate the timetable for phasing out the free allowances, with 48.
