European Commission president Ursula von der Leyen today called for greater emissions trading system (ETS) revenues to be ploughed back into industry.
Speaking in Antwerp, Belgium, with industry leaders ahead of a meeting Thursday with EU leaders, Von der Leyen called on leaders to "save" EU industry by lowering energy and carbon costs, and that it is "high time" for EU states to "step up and match" EU-wide levels of channelling ETS revenues back to the industry.
She noted EU-wide ETS revenues have totaled over €260bn ($187bn) since 2005. "But member states invest less than 5pc of ETS revenues in industrial decarbonisation," she said. "This will be a core focus of the upcoming reform of our ETS this summer."
Among the many demands at the industrial leaders' summit in Antwerp, organized this year by chemicals association Cefic, was a call to reflect on the ETS itself. "After 20 years in the ETS we might have gone in the wrong direction," said Marco Mensink, Cefic director general. "That's where you hear the urgency."
Besides calling for more common EU debt and greater European sovereignty, French president Emmanuel Macron noted that the carbon border adjustment mechanism (CBAM) is a necessary tool, but only if it works in practice. "Without CBAM, it's over. No chance to preserve our steel industry without implementing CBAM," Macron said. The bloc's ETS must support decarbonization "in the long run, but without undermining competitiveness", Macron added.
Fertilizer giant Yara's chief executive Svein Tore Holsether urged EU climate commissioner Wopke Hoekstra to provide more certainty on CBAM. Holsether said the mechanism entered into force on 1 January and only seven days later the European Commission created "significant" confusion among fertilizer producers by talking of "suspending, pausing [implementation of CBAM for fertilizers], possibly with retroactive impact".
EU trade commissioner Maros Sefcovic said on 7 January that some proposed changes to CBAM could allow for a "temporary suspension" for certain CBAM goods, and that these could even apply retroactively. The commission proposed in December changes to the CBAM regulation, including Article 27a, which would "empower" it to remove goods temporarily from the CBAM goods list if it considers that their inclusion "causes severe harm to the union's internal market due to serious and unforeseen circumstances" related to the CBAM's impact on the prices of goods. European industry associations and companies have since urged for this proposed change to be rejected in order to not undermine market trust in CBAM and wider EU climate policies.
"Not everything we do is always the gold standard, to phrase it diplomatically," Hoekstra said, admitting the need for dialogue with the fertilizers sector.
The firms behind the Antwerp summit also called for public procurement and private buyer initiatives to boost demand for net-zero, low-carbon and circular products. "We are not asking for protection from change", said Cefic president Markus Kamieth, who is also chief executive of BASF. "We're asking for competitive conditions to lead the change".
