A group of ten EU member states is pushing for the ETS2, the emissions trading system for buildings and road transport, to be explicitly included in the upcoming revision of the EU carbon market. The countries argue that the current reform proposals do not adequately address how the ETS2 will operate after 2030, creating uncertainty for investors and national governments planning their decarbonization strategies. The coalition wants clearer rules on how the ETS2 interacts with the existing ETS1 and national carbon taxes. They are also seeking guarantees that the social climate fund will be sufficient to offset the higher energy costs that households and small businesses will face as the ETS2 cap tightens. The European Commission is expected to present a legislative proposal later this year, and this push from member states signals that the design of the post-2030 carbon market will be a major point of contention.
