The EU Emissions Trading System EU-ETS 2

“The EU ETS 2 is indispensable for the decarbonisation of the road transport and buildings sectors. Watering it down would jeopardise the effective and cost-efficient achievement of climate targets,” emphasises cep Head of Department Götz Reichert, who co-authored the study, commissioned by the European Automobile Manufacturers’ Association (ACEA), with André Wolf and Jan Voßwinkel. The EU ETS 2 sets a binding emissions cap and creates a uniform CO₂ price. This ensures that emissions are reduced where it is most cost-effective to do so. A strong price signal promotes long-term investment and innovation for the transition to climate-friendly technologies such as zero-emission powertrains for trucks.

“The solution therefore lies not in weakening EU ETS 2, but in consistently mitigating its social impact,” emphasises André Wolf, cep Head of Department. “The Social Climate Fund provides Member States with the necessary, but not sufficient, resources to make decarbonisation socially acceptable. Policymakers should therefore significantly strengthen such support mechanisms to mitigate undesirable social hardship caused by carbon pricing.”