EU ETS deal adds 120 million free allowances worth over €10bn for industry through 2030

The European Parliament and Council reached a provisional agreement to raise heat and fuel fallback benchmarks under the EU ETS for 2026 to 2030. That change will release roughly 120 million allowances for industry, valued at more than €10bn. The benchmarks determine how many free allowances energy intensive sectors receive, and the update is meant to reduce carbon leakage risk without triggering the cross-sectoral correction factor. The agreement also introduces sector-specific fuel benchmarks, with ceramics singled out as a sector at high risk of carbon leakage. The Commission says the move supports industrial competitiveness while still rewarding efficient production and cleaner technologies. For anyone tracking EU carbon policy, the main question is how these benchmark levels are set and whether they push companies toward electrification and efficiency instead of simply lowering the cost of existing fuel use.