The EU emissions trading system (ETS) is the key policy tool for achieving the EU's climate targets. The existing ETS (ETS1) aims to reduce greenhouse gas emissions from industrial and energy installations, aircraft operators and maritime transport by setting a price on carbon through a cap-and-trade system.
The Commission's ETS revision proposal is expected to address several issues, notably the role of carbon dioxide removals, the expansion of the current scope to additional sectorsand GHGs not yet covered by the ETS, new rules on how to account for non-permanent carbon capture and utilisation, and the risk of carbon leakage in sectors not covered by the carbon border adjustment mechanism.
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