EU adopts expansion of carbon market to heat, transport and social climate fund –

Members of the European Parliament agreed early on Sunday (December 18) to introduce a carbon price for buildings and fuels for road transport. In parallel, a new Social Climate Fund, equipped with €87 billion, has been created to reduce impacts on households and help them invest in environmental solutions.

The new carbon price, which will become a tax on the emissions produced, will apply to fuels such as gasoline, diesel and heating fuels, whose emissions contribute to global warming, such as natural gas.

It was the most contentious moment in negotiations to reform the EU’s Emissions Trading Scheme (ETS), the world’s largest carbon market and the EU’s flagship climate policy instrument.

Agreement on the extension of the carbon market to heating and transport

The biggest problem was ETS 2 Peter Liese, a German lawmaker representing the European Parliament in the two-day talks that began on Friday and ended Sunday morning, said.

At the end of the talks, the negotiators agreed to start setting a carbon tax from the burning of fossil fuels for road transport and heating in 2027, with a price cap of 45 euros per ton of carbon emitted into the atmosphere, which will be applied until 2030.

contract” More ambitious than the European Commission expected said Mr. Liese, because now it includes ” heating processHeating of both industrial activities and offices within the new system.

Agriculture and fisheries will not have to pay an additional carbon cost because they are sectors.”sensitive“Diesel-powered trains are also excluded from the scope of the scheme and will not be taxed accordingly on their carbon emissions,” Mr Liese said.

According to a study by the Potsdam Institute for Climate Research, the new system will lead to higher prices at the pump: up to 10.5 cents per liter for petrol and up to 12 cents for diesel.

The prices of heating fuels such as gas, fuel oil and coal will also increase, to the detriment of poorer EU Member States that depend more on polluting fossil fuels.

EU citizens should expect higher CO2 pricesGreen MEP Michael Bloss, who participated in the final negotiations on the ETS, explained.

With the current energy crisis, the new system could be delayed by a year, until 2028, if energy prices remain.extraordinarily high“It is said in the statement of the Parliament.

The interim deal now needs to be approved by EU member states and the European Parliament, who will vote at a plenary session in January or February.

Social Fund for Climate 87 billion euros

Negotiations on the emissions trading scheme for buildings and road transport (ETS 2) dragged on until Sunday due to the political sensitivities of many considering it a new tax.

The chairman of the European Parliament’s Environment Committee (ENVI), Pascal Canfin, first warned against this system, saying that “political suicideand risked triggering a European movement similar to that of the Yellow Vests in France.

Aware of this risk, MEPs have agreed to introduce a new Social Climate Fund to protect European households from rising fuel prices.

According to the agreement, this fund will be allocated 87 billion euros and will be used from 2026, that is, one year before the introduction of the carbon tax on heating and transport. It will be financed by the revenues generated by ETS 2 and 25% of the funds will come from the Member States.

The strict conditions we set […] and in particular the introduction of a price cap of €45 until at least 2030, make this measure politically acceptable in my eyessaid Mr. Canfin.

This is a balanced agreement that achieves the ambition we need to make the climate transition fairer and more equitablesaid Maltese MP David Casa, who mediated the signing of the agreement on behalf of the European People’s Party (EPP).

States that are members of the bloc“Billions will be at their disposal”to support“Vulnerable households and micro-enterprisesMr Kasa told EURACTIV.

Provided that ETS 2 revenues are not allocated directly to the Social Climate Fund, the funds will be allocated effectively.“to be preferred”to mitigate the impact of the measure on the most vulnerable groups.

“The Social Climate Fund will help vulnerable households with energy transitions, such as vouchers for insulation or switching to greener transport options”explained Esther de Lange (EPP), who negotiated the Fund with Mr. Casa.

However, environmentalists were more critical, with Greens MEP Michael Bloss (Greens/EFA) saying the fund “is notnot enough to compensate for this burden“.

“[Les mesures de]EU climate protection is anti-social”said Mr. Bloss.

[Édité par Anne-Sophie Gayet]

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