The European Parliament voted in favor of reforming the European Union’s carbon market post-2021 in an effort to help the EU reach its climate change goals.
Specifically, the Parliament voted in favor of a proposal to reduce the number of “carbon credits,” or emission allowances, by 2.2% each year, as well as doubling the capacity of the 2019 market stability reserve (MSR) to absorb any excess allowances.
According to European Parliament News, Members of the European Parliament (MEPs) “approved the [European Commission’s] proposal to increase the so-called “linear reduction factor” — the yearly reduction of credits in order to deliver on the carbon curbs — by 2.2% from 2021, as against 1.74% in the existing legislation.” The MEPs also voted to ensure that this would be kept under review with the possibility of increasing it to 2.4% by 2024.
As for the 2019 MSR, the plan would see up to 24% of the excess of credits in each auctioning year absorbed by the MSR, and that 800 million allowances should be removed from the MSR starting the beginning of 2021.
“I am very grateful to my colleagues for supporting this report. Today’s vote marks a major step forward towards meeting our ambitious climate change targets” said Ian Duncan, MEP with the European Conservatives and Reformists Group. “Parliament has voted through ambitious measures to fulfil our Paris Agreement obligations, and we have sent a strong signal to the European Council that we are serious about the fight to stop global warming.”
“Today’s landmark vote provides a clear outcome after more than a year of discussions in Parliament, and it demonstrates the European Union’s commitment to turning the Paris Agreement into reality through concrete action on the ground,” said Miguel Arias Cañete, Commissioner for Climate Action and Energy. “Now the EU ETS revision is on the Council’s table and we hope they can swiftly reach an agreement to kick-start negotiations.”