TL;DR
• EU member states will extend the carbon price regulation mechanism beyond 2030 to prevent excessive spikes when the new tax on cars, vans, and buildings takes effect in 2028.
• Slovakia and the Czech Republic have urged a delay of the new carbon tax until at least 2030, due to its social impact, as of 18 February 2026.
• Five EU countries, including Sweden and Denmark, oppose any amendments to the ETS2, arguing it undermines EU climate policy effectiveness.
• Wopke Hoekstra stated that new measures aim to strengthen the stability and affordability of ETS2, allowing up to 80 million allowances to be released to manage price spikes.
EU Member States Plan to Regulate Carbon Pricing Beyond 2030
The EU is set to extend its mechanism for regulating carbon price spikes past 2030.
Households and businesses will face higher bills once emissions trading takes effect.
Discussions are ongoing regarding potential delays to the implementation of the carbon tax.
EU member states will extend the bloc’s mechanism to regulate price spikes beyond 2030, aiming to manage the carbon price under the new tax system that will come into effect in 2028. This decision has emerged amidst rising concerns about the implications for households and businesses reliant on fossil fuels, which are expected to see increased costs.
Resistance to fully implementing the new version of the European Union’s emissions trading system (ETS2) is growing. Slovakia and the Czech Republic have called for delays, citing social impacts, while other countries, including Sweden and Denmark, oppose any postponements.
Maria Panayiotou Highlights the EU’s Commitment to Carbon Market Stability
Maria Panayiotou emphasised the EU’s dedication to a predictable carbon market.
The Council’s adjustments to the market stability reserve aim to manage carbon allowance supply effectively.
These changes will increase the ability to release allowances in response to price spikes.
The EU’s market stability reserve, intended to manage surplus allowances, is a crucial long-term tool for maintaining balance in the carbon market. Following amendments, it now allows for the release of additional allowances if prices rise sharply, enhancing resilience against potential shocks.
“The Council’s position… sends a clear signal that the EU is committed to a stable and predictable carbon market,” said Maria Panayiotou. The adjustments also foresee maintaining a buffer of 600 million allowances to help stabilise prices.
Wopke Hoekstra Discusses Future Steps for ETS2 Implementation
Wopke Hoekstra stated that new measures will promote stability within ETS2.
Current mechanisms allow for strategic releases of allowances to prevent excessive price spikes.
The final rules for ETS2 await approval from the European Parliament.
Wopke Hoekstra, Commissioner for Climate, Net Zero and Clean Growth, indicated that new measures are designed to “set us on a more predictable path toward a low-carbon future”. The mechanisms have been refined to accommodate a potentially volatile market, and with up to 80 million allowances available, the system is geared to keep prices manageable.
The Council’s agreement is set to be scrutinised by lawmakers in the European Parliament, who must approve the final rules ahead of the scheduled ETS2 launch in 2028.
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Interesting read, though I think there are some points that could have been explored further. Would love to see a follow-up on this topic.
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