The European Union is considering the possibility of revising or even temporarily suspending its carbon market if it does not contribute to an effective transition of industry towards environmentally friendly production. This position was expressed by German Chancellor Friedrich Merz during an industrial summit in Antwerp.
This is reported by Finway
Discussion on Reforming the Carbon Market in the EU
The issue of the effectiveness of the European Emissions Trading System (EU ETS) has become one of the main topics on the agenda of the European Commission. High carbon prices that have formed in the market have drawn criticism from industry representatives, as many believe they negatively impact the competitiveness of businesses across various sectors.
As recently as last year, Germany stated its intention to relax environmental requirements for the most polluting sectors of its industry. Merz emphasized that the EU ETS was designed to reduce carbon emissions and stimulate the “green” transition of the businesses it covers.
“If this cannot be achieved and if this is not the right tool, we must be open to its revision or at least its postponement,” Merz noted.
He also highlighted that similar decisions had already been made regarding ETS2 — a new tool that covers emissions from buildings and transport.
Position of EU Governments and Next Steps
European governments are currently considering the possibility of slowing down the pace of pollution reduction and implementing measures aimed at lowering costs for industry. According to European politicians and diplomats, such changes could help industry adapt to new environmental standards without jeopardizing jobs.
At the same time, the EU is analyzing future cooperation with the United States, trying to avoid increased competition from China, and increasing investments in the defense sector following the Russian invasion of Ukraine. The focus of EU policy is increasingly shifting towards reducing energy costs and supporting economic stability.
Friedrich Merz emphasized that he understands the need to strengthen climate policy but stressed the importance of maintaining a balance between environmental goals and supporting industry and jobs.
“Therefore, I agree with everyone who says that if this is not the right tool, we need to discuss it and change it,” he said.
The European Commission is expected to present its proposals for reforming the carbon market in the third quarter of 2026.