Reforms EU ETS
Currently the low market prices for emission allowances provides a modest stimulus for investing in CO2 reduction and innovation.The low price is mainly caused by a surplus of allowances.
Market stability reserve
The European Commission (EC) has proposed encapsulating a market stability reserve (MSR in the EU ETS.The proposal entails keeping a certain amount of emissions allowances in reserve. If there is a major surplus of allowances, the EC would add to the reserve by auctioning off fewer allowances than planned. In the event an allowances deficit, extra allowances from the reserve could be auctioned.The MSR could have a positive effect on the market, since it would lead to a higher emissions price.This could contribute to confidence in the EU ETS market being restored.
EU ETS Guideline revision
On 15 July 2015 the European Commission submitted a proposal to revise the EU ETS Guideline for the 2021-2030 period. The proposal includes such things as lowering the ETS ceiling so as to reach a CO2 reduction of at least 43% by 2030. More information can be found under EU ETS Guideline revision.