Read our EU ETS response
Read our Innovation Fund response
Our main messages:
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Simplify the EU ETS by phasing out free allocation
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Aviation: put a seat belt on EUA supply
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Free allocation: switch from process to products
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Link indirect cost compensation to carbon-free electricity only
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Reform the Innovation Fund to:
– Better assess the carbon footprint of electricity use
– Reserve grants to technology risk
– Reserve scale-up subsidies to poorly capitalised sectors -
Market Stability Reserve: reduce the reinjection rate as well as thresholds
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Keep carbon removals out of the ETS
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Do not shift CCU carbon accounting down value chains
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Limit linking with other ETS
Read our responses on the European Commission’s website:
Related publications
May 25th 2023
More on the EU ETS and climate financing
Our concerns regarding ETS and CBAM legislative texts
2nd ETS trilogue: EU institutions agreed on almost nothing, except on perpetuating free allocation for the steel giants
The second ETS trilogue took place last week on October 11th. Tabled proposals on benchmarks regarding the steel…
European Scrap Steel Floats Away Under Carbon Market Incentives
In 2021, over 14 million gross tonnes of ships were dismantled, with a third owned by European firms and largely scrapped in South Asia. This practice exports high-quality scrap steel that could otherwise support low-carbon steelmaking in Europe. However, EU carbon market rules currently favour carbon-intensive blast furnaces over cleaner electric arc furnaces (EAFs) by allocating more free emissions allowances to the former. This distorts incentives, discouraging investment in greener technologies. Sandbag calls for a faster phase-out of free allowances and a more comprehensive CBAM to promote domestic recycling and decarbonisation.
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