The European Union on Sunday announced an agreement for a major reform to overhaul the bloc’s carbon market. The historic deal which aims to lower emissions and invest in climate-friendly technologies was unveiled by member states and MPs on Sunday.
As per an EU statement, the agreement aims to speed up emission cuts, phase out free allowances to industries, and target fuel emissions from building and road transportation sectors.
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The deal means that emissions in the Emissions Trading System (ETS) sector will be cut by 62 per cent by 2030.
AFP reports that the accord also aims to speed up the process of eliminating free allowances, with a 48.5 per cent reduction by 2030 and a complete elimination by 2034.
Depending on the commission’s favourable assessment, the carbon market will gradually be expanded to include the marine industry, flights inside Europe, and waste incineration facilities.
Under the “polluter pays” premise, the EU ETS enables power producers and sectors with high energy needs, such as steel and cement, to buy “free permits” to cover their carbon emissions.
These quotas, as per AFP, will decrease over time to encourage companies to emit less every year and invest in greener technologies as part of the EU’s goal of achieving carbon neutrality.
Negotiators for member states and the EU parliament undertook the crucial talks for more than 24 hours before reaching the agreement that will significantly broaden the European Union carbon market.
(With inputs from agencies)