See also
Carbon price forecast under the EU ETS2
The EU Emission Trading System (EU ETS), introduced in 2005, has been a core instrument in the EU's policy setting toward decarbonisation. The next two years will be absolutely pivotal for the future of carbon pricing in Europe, with a revision of the ETS directive, the Market Stability Reserve, and the ETS2 adding road transport, building and SMEs.
According to preliminary data released by the European Commission, CO2 emissions under the EU Emissions Trading System (ETS) scheme dipped by 0.4% in 2015, the fifth decline in a row.
This contraction is linked to a 0.4% decrease in CO2 emissions from the power sector to 1,014 Mt, as renewable power generation continued to grow; in addition, cheap gas prices contributed to a higher use of gas-fired power plants to the detriment of high-emitting coal-fired power plants.
Emissions from the industrial sector also contracted by 0.4%, due to lower production in the steel and cement sectors and to more efficient CO2 refining.
The ETS caps the emissions of more than 11,000 power plants, industries and airlines. It covers around 45% of greenhouse gas (GHG) emissions in the European Union and is expected to contribute by 2/3 of the reductions needed to meet the target of a 20% cut in emissions by 2020 (from 1990 levels).
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