MEPs squander key opportunity to fix the EU carbon market

Climate action

The European Parliament’s Industry Committee (ITRE) voted today on a new Directive to redesign the EU Emissions Trading Scheme for the coming decade. However, according to CAN Europe the lacklustre compromises reached between the major political groups have done little to repair the broken scheme or align Europe’s emissions trajectory with the global temperature goals it committed to under the Paris Agreement.

The industry committee refused to speed up annual emission reductions via the so-called Linear Reduction Factor or to align the starting level of the new carbon budget with actual emissions. The ITRE committee furthermore missed an opportunity to cancel a substantial amount of the surplus pollution permits that would flood the ETS after 2020. All these measures are vital in order to drive a shift away from fossil fuels to more energy efficiency and renewables.

The committee did agree to cancel 300 million allowances from the Market Stability Reserve (MSR), which temporarily stores surplus carbon permits. But with the MSR set to contain billions of allowances by 2020, the measure is far too small to meaningfully impact the carbon price or make polluting industries pay for the harm they cause to the climate. Nevertheless, it sets a precedent for further negotiations on the ETS reform, as it is the first time that members of the ITRE committee agreed to permanently cancel pollution permits because of the gigantic surplus that has built up.

Commenting on the vote results, Wendel Trio, Director of Climate Action Network (CAN) Europe said:

“The industry committee closed its eyes to the problem that the carbon market is failing and needs to be substantially improved well beyond what the Commission has proposed last year. Turning a blind eye to the need to scale up emission cuts is simply careless when the effects of climate change are becoming increasingly dire. The industry committee kicked the can down the road to the environment committee to make the ETS truly fit for purpose and turn it into a strong tool that helps the EU deliver emission cuts in line with the Paris Agreement.”

According to CAN Europe, the adopted position shows that most MEPs in the ITRE committee are out of touch with concerns of EU citizens. Over the course of only one week, over 55 000 people signed a petition launched by the CAN Europe network to urge Members of the European Parliament to vote for an ambitious reform of Europe’s climate policies.



[1] The petition signatures ( were handed in to Jakop Dalunde, shadow rapporteur for the Greens in the industry committee and Bas Eickhout, shadow rapporteur for the Greens in the environment committee on 11 and 12 October.

Images are available here:

[2] In the process to reform the EU ETS, the industry committee of the European Parliament shares some competence with the environment committee, which leads the work on the file.

[3] The next important moments in the reform of the EU Emissions Trading System (ETS) will be the vote in the European Parliament’s environment committee on 8 December, as well as a debate at the Council of Environment Ministers on 19 December 2016.

[4] Infographic ‘EU citizens pick up climate polluters’ bill’:


Wendel Trio, CAN Europe Director,, +32 473 170 887

Ania Drazkiewicz, CAN Europe Communications Coordinator,, +32 494 525 738

Climate Action Network (CAN) Europe is Europe’s largest coalition working on climate and energy issues. With over 130 member organisations in more than 30 European countries – representing over 44 million citizens – CAN Europe works to prevent dangerous climate change and promote sustainable climate and energy policy in Europe.