EURELECTRIC statement on EU ETS reform

News Article

EURELECTRIC has published a statement in which it outlines a number of priorities for the European power sector regarding the ongoing discussions on EU ETS reform. The statement reiterates the sector’s commitment to decarbonisation and highlights its concerns with the proliferation of national measures which undermine the effectiveness of the EU ETS as a cost-effective European-wide mechanism. EURELECTRIC stresses the importance of ensuring that the discussions on the current ETS reform should focus on efforts to strengthen the EU ETS to ensure that it is the key policy instrument to deliver decarbonisation and low carbon investment in Europe.

In its statement,EURELECTRIC states that achieving the decarbonisation objectives agreed in the Paris Agreement is essential to guarantee the long-term sustainability of the global economy. EURELECTRIC’s members are committed to delivering a carbon neutral power supply in Europe and to ensuring a competitively priced and reliable electricity supply throughout the integrated European energy market. This commitment to decarbonise electricity generation, together with the electrification of key sectors, such as heating, cooling and transport, will make a major contribution to help Europe meet its climate change targets.

EURELECTRIC supports a strong EU ETS as the cornerstone of the EU’s energy and climate policy and as a key driver for market-based investments in low-carbon electricity generation.  However the European power sector association also states that additional work is needed in order to make the EU ETS the main instrument to provide incentives to reduce greenhouse gas emissions, improve energy efficiency and to invest in low carbon technologies. A strong EU ETS system is an essential element in order to avoid further fragmentation of EU climate policy through national measures, and to facilitate further market integration.

In order to ensure investor predictability, EURELECTRIC is also calling for a timely study of all options to bring the EU’s decarbonisation ambition in line with the ambition of the Paris Agreement, as part of the EU’s expected contribution to the 5-yearly global ambition review cycle under the UN Framework Convention on Climate Change (UNFCCC). 

“We believe that the revised ETS Directive should incorporate the necessary provisions to enable future adjustments to the EU ETS to reflect any possible increase in EU climate ambition resulting from the UNFCCC’s 5-yearly global ambition review cycle,” said EURELECTRIC Secretary General, Hans ten Berge. “This will help ensure that the EU is able to participate fully and constructively in efforts to meet international climate objectives, and should include provisions to ensure that the EU keeps all options open for increasing its climate ambition in due course,” he added.

In light of the recent discussions on the Commission’s proposal in the EU institutions, the EURELECTRIC statement also refers to the various options being proposed by different stakeholders to strengthen the EU ETS in light of the Paris Agreement. EURELECTRIC says that these options should be assessed in terms of their effectiveness, efficiency, impact and timing in delivering cost-effective emissions reductions in the EU, consistent with the Paris Agreement objectives and the actions of Europe’s global competitors. The consideration of any such measures should ensure that energy and climate policies are guided by the need to maintain a strong European dimension.

 

Background: In November last year, EURELECTRIC published a position paper in which it reacted to the Commission’s proposal to revise the EU ETS Directive in which it had welcomed the proposal as it puts the EU on course to take important steps on the path towards the cost-effective decarbonisation of the European economy.