It is the largest legislative package ever examined in Europe. In July and December 2021, the European Commission presented a twenty or so legislative proposals to enable the European Union (EU) to meet its climate objectives: to reduce greenhouse gas emissions by at least 55% by 2030 compared to 1990 in order to achieve the carbon neutrality by 2050. On Wednesday June 8, the European Parliament was to vote on eight of these texts, which will then be examined by the Council, before a trialogue. Overview of these technical legislations which will draw the climate roadmap of the Twenty-Seven.
Carbon market reform
MEPs have rejected a key text on the strengthening of the European carbon market, deemed not ambitious enough by the left and too much by sovereigntists and the far right, which will lead to a complete renegotiation of this pillar of the EU climate plan in a parliamentary committee. The most polluting industries (electricity production, steel, cement, etc.), which represent 40% of CO emissions2 of the EU, have been subject to the Emissions Trading System (ETS) since 2005, i.e. they must pay for their emissions. While this polluter-pays principle has worked for the electricity sector, it has not enabled heavy industry to reduce its carbon emissions. It benefits from millions free allowances (which cover 94% of its emissions), set up to avoid relocations, and the price per tonne of CO2 remained too low for a long time to be an incentive.
The Commission, which has included the maritime sector in the ETS, proposes to put pressure on the market, by gradually reducing the number of rights to pollute and by programming the progressive end of free quotas, in order to raise the price per ton of CO2 − today at around 80 euros. The end date of free quotas (in 2030, 2032 or 2034) is debated. “This pollution subsidy must be stopped quickly”calls Thomas Pellerin-Carlin, director of the energy center of the Jacques-Delors Institute, recalling that the equivalent of 90 billion euros has gone to industry in this way since 2008.
The text provides also the creation, from 2025, of a second carbon market, for the heating of buildings and road transport. In practice, this amounts to requiring fuel, gas or fuel oil suppliers to buy rights to pollute, an additional cost that they could pass on to household bills. To limit the social impacts, particularly in the context of the war in Ukraine and soaring prices, and three years after the “yellow vests” conflict, Parliament proposed not to integrate households into this market before 2029 and to cap the price of CO2 at 50 euros per ton.
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