MONITORING DESK
BRUSSELS: A significant overhaul of the group’s flagship carbon market and a new fund to safeguard vulnerable people from soaring CO2 costs were agreed on by European Union (EU) negotiators on Sunday as part of talks that started on Friday.
“After prolonged negotiations, we reached an agreement about the formation of a social climate fund (SCF) and a new ETS,” vice chair of the European People’s Party Esther de Lange tweeted.
Touted as the base of the Europe Union’s climate efforts, transforming the Emissions Trading System (ETS) is critical to reducing 55 percent of CO2 emissions by 2030, Politico news website reported.
“We just reached a deal on the biggest climate law ever deliberated in Europe,” German MEP Peter Liese said, who steered the talks on the bill.
European Union climate efforts
As part of the compromise, European Union brokers demanded that heavy polluters and power generators covered by the ETS would have to control their pollution by 62 percent by the end of 2030, one percent more than the European Commission had initially proposed.
The scheme will cover waste from 2028, with potential exemptions until 2030.
The agreement also mandates that all the carbon market-generated revenues “shall” be spent on climate change action.
“That’s one of the biggest victories of the Parliament,” Liese told a press briefing held shortly after the end of the negotiations.
The border tax covers steel, cement, aluminum, hydrogen, fertilizers, electric energy production, and iron.
However, negotiators remained short of introducing partial refunds to protect exports, asserting they would have proven incompatible with World Trade Organization (WTO) rules.
The agreement also urges a parallel carbon market to make up for fossil fuels used to heat buildings and power cars from 2027.
