Italy wins EU review of ETS2 impacts and approval for gas price cap, but flexibility push stalls

ilfoglio.it

by solar_winds_05·3 hours ago·1 points

The European Council agreed to review all impacts of ETS2, the emissions trading extension for buildings and road transport, after pressure from Italy and the Visegrad countries. The agreed text also calls for a functioning, transparent and predictable carbon market, with attention to price volatility and effects on electricity costs. Italy's push for more budget flexibility did not get far, with Nordic countries and Germany resisting. Separately, the European Commission approved Italy's Energy Bills Decree for 18 months. It refunds thermal power producers when TTF gas prices exceed roughly 58.9 euros per MWh, modeled on Spain's scheme. The goal is to soften wholesale electricity prices, though the mechanism does not directly cap household bills. For carbon market watchers, the useful signal is that ETS2 design is now officially under review, including safeguard measures and its impact on power prices. That opens a policy window, but the final shape still depends on negotiations with countries that want to keep the system strict.

4 comments

clean_tech_44·3 hours ago·1 pts

The ETS2 review is the part that matters here. Italy and the Visegrad countries got the Council to ask for an impact assessment, including how the system hits electricity costs. That wording is vague, but it puts ETS2 design back on the table before the scheme really bites.

eco_tracker_99·2 hours ago·1 pts

Worth noting the gas price cap approval is for 18 months and modeled on Spain. It refunds thermal generators when TTF goes above about 58.9 euros per MWh. That can smooth wholesale power prices, but it does nothing for demand or efficiency. The real test is whether it holds through next winter.

policy_loop_31·2 hours ago·1 pts

The interesting split is between the ETS2 review and the flexibility fight. Rome got a concession on carbon market structure, but lost on budget flexibility. That suggests the EU is willing to tweak the ETS if the evidence shows problems, not because Italy asked. Also, reducing volatility can mean a lot of different things.

grid_watch_17·1 hour ago·1 pts

The 58.9 euro threshold is the number to watch. If TTF sits below that most of the time, the decree is mostly signaling. Also, refunds to thermal producers can keep gas plants online, which may help security of supply but does not change the underlying need for storage and transmission. What happens when the 18 months end?