03/01/2024
The European Commission has introduced a new emissions trading system called ETS 2, as part of the 2023 revisions to the ETS Directive. ETS 2 aims to address CO2 emissions from fuel combustion in buildings, road transport, and additional sectors to help achieve emission reduction targets. It will operate alongside the existing EU ETS, focusing on fuel suppliers rather than end users. The system is set to start in 2027, with a cap to reduce emissions by 42% by 2030 compared to 2005 levels. Emission allowances will be auctioned, with some revenues supporting social and climate action measures. The ETS 2 will also have a market stability reserve to manage allowance supply and prices effectively.
In 2023, a new, separate emissions trading system was created: Emissions Trading System 2 (ETS 2).