Essential elements for turning the EU ETS (Phase IV) into a driver for a sustainable and competitive industrial Europe

12 May 2016
Position Paper

Climate change is one of the greatest challenges which our society faces. European industry is contributing actively to mitigation through improving efficiency of production as well as providing innovative solutions for mitigation and adaptation across many sectors of the economy in the EU and abroad. In a context of increasingly global competition, adequate regulatory frameworks are indispensable to a sustainable future of high-performing and climate-friendly businesses in Europe.

The EU ETS, as Europe’s central climate policy tool for industry, has to be designed in such a way that it effectively enables to reduce GHG emissions overall while strengthening the EU’s global competitiveness. ERT take the view that the reform of the EU ETS (phase IV) requires a number of essential elements.

  • A stable and predictable long-term policy framework that ensures continuity, coherence and effectiveness is essential for the transition to a low-carbon society.
  • Towards global carbon pricing while safeguarding the global competitiveness of sectors at risk of carbon and investment leakage until a global level playing field is achieved.
  • A future-proof ETS takes account of the opportunities offered by the COP21 Paris Climate Agreement to allow reaching the targets in the most cost-effective way.
  • The EU ETS should be considered as part of an ambitious innovation agenda stimulating solutions and investment for the transition towards a low carbon society.