EU reaches deal to overhaul European Emissions Trading System (ETS)

EU negotiators have reached a provisional deal to overhaul the EU Emissions Trading System (ETS), bolster carbon prices and adjust the system to more ambitious climate goals, Ewa Krukowska reports for Bloomberg. The deal follows more than two years of uncertainty over the future of the ETS, and has pushed permit prices up more than 3 percent. Under the agreement, the number of allowances transferred to the so-called Market Stability Reserve will double over a five-year period starting in 2019, Bloomberg reports. From 2023, permits in the reserve will begin expiring if they exceed the amount sold at auctions in the previous year. EU member states will also have the option of cancelling permits linked to closed power plants. 

Speaking to Clean Energy Wire at COP23, the German state secretary Jochen Flasbarth warned that the deal would not substitute the national measures needed for the EU to reach its climate targets. “I foresee that some will see this reform as a solution to it all – which it is not,” Flasbarth said.

Read the Bloomberg article in English here.