European Union countries backed proposals on Wednesday to give heavy industries more free emissions permits over the next few years, in a move aimed at helping struggling companies stay economically competitive, Reuters reported.
EU countries approved a European Commission proposal to grant industries an extra 121 million free CO2 permits over 2026-2030, based on their heat production and fuel use, the Council of the EU said in a statement. According to Reuters calculations, the move could save companies around €8.25 billion ($9.52 billion) in carbon costs, and grants more free permits than the Commission had originally proposed. Beneficiaries would include chemical producers, metals processing companies, and ceramics and glass makers.
Under the EU’s Emissions Trading System (ETS), heavy industries must buy permits to emit CO2, creating an incentive to keep emissions as low as possible. A pool of free CO2 permits also exists to help companies compete with foreign rivals that do not face equivalent carbon costs. The new plan would temporarily increase this free allocation, even though the ETS is designed to gradually reduce free permits over time to ensure emissions fall.
EU countries will now negotiate the final rules, known in EU terminology as the ETS “fall-back benchmarks,” with the European Parliament. Those talks are being fast-tracked with the aim of reaching a final deal this year. The EU is separately negotiating a broader reform of the ETS, with a deal targeted for 2027.
(Reuters)
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