Reform of EU ETS is needed say manufacturers


Britain’s manufactures are calling for significant reform of the EU Emissions Trading System (EU ETS) warning that, left unchecked, in its current form it could drive crucial investment in energy intensive industries (EIIs) out of Europe.

The call was made by EEF, the manufacturers’ organisation which believes the reform must also be accompanied by a wider review of EU climate change policy to ensure it is fit for purpose to achieve the twin goals of reducing emissions, whilst keeping key industries competitive.

Commenting, EEF head of climate & environment policy, Gareth Stace said: “Reducing our carbon emissions through to 2030 is going to be an enormous challenge with the targets currently on the table representing a tripling of effort from 2020 onwards. We cannot hit those targets without support for energy intensive industries and reforms must ensure we retain these in Europe.

“If we leave the EU ETS essentially as it is today with only minor reforms then we will only serve to push these vital industries through the exit door to other parts of the world.

“The current climate change landscape is also markedly different to a decade ago when EU ETS was first introduced and policy needs to reflect this. Between now and 2020 we have the opportunity to take stock and reform the wider policy framework. This will ensure it is fit for purpose and keep our fundamental industries competitive while, at the same time, helping them decarbonise and introduce new technologies.”

The European Council will meet in October to reach agreement on an energy and climate change framework to guide the EU through to 2030. This will examine a new emissions reduction target and the possibility of renewed commitments for energy efficiency and renewable energy.

At the centre of this framework sits the EU ETS which is tasked with reducing emissions from the power and industrial sectors by placing a price on carbon. Reform proposals will see increasingly tough targets through the 2020s and mechanisms to increase the price of carbon.

However, EEF is warning that, while this will deliver investment in many sectors, including renewable energy, without additional support and protection measures it will do little more than reduce EU production in some sectors and drive investment and emissions abroad.


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