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Getting Electrification Right: The broader challenge of induced emissions

Getting Electrification Right: The broader challenge of induced emissions

This report examines how the climate impact of electricity use is shaped not just by its source, but also by its timing and location. It evaluates the EU’s RED III framework and associated hydrogen targets, using the RFNBO standard as a case study. The analysis shows that ill-timed use of renewable electricity (particularly for hydrogen production) can inadvertently drive fossil generation. It argues for more strategic use of electricity to avoid these unintended consequences and support genuine decarbonisation.

CBAM extension: Closing the emissions gap

CBAM extension: Closing the emissions gap

Free allocation has long been used to address carbon leakage under the EU ETS, but it has key limitations. It only covers emissions up to benchmark levels, fails to reward cleaner EU producers, and forfeits auction revenues that could support decarbonisation. It also creates perverse incentives by making high-emission goods artificially cheap.

Auction for industrial heat electrification: A positive step, but mind the induced emissions!

Auction for industrial heat electrification: A positive step, but mind the induced emissions!

Industrial heat electrification is a key strategy for decarbonising energy-intensive industries by replacing fossil-based heat. We welcome the European Commission’s initiative to launch an auction to electrify industrial heat, while emphasising the need for careful design to prevent unintended increases in emissions due to electricity grid dynamics. 

In or Out: What’s best for carbon removals and the EU ETS?

In or Out: What’s best for carbon removals and the EU ETS?

What will the future of the EU Emissions Trading System (ETS) look like as the emissions cap heads towards zero? Is integrating carbon dioxide removals (CDRs) into the ETS a solution to help the EU achieve its climate goals? Or would they compromise the integrity and functioning of the system? These questions are at the forefront of the Commission’s mind as they review different options for the future of the ETS ahead of the 2026 revision.

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