EU has reached an agreement carbon market

EU member states reached an agreement in the early hours yesterday on revising the bloc’s carbon market EU’s main political tool to fight global warming.

The agreement allows us to meet climate targets in key economic sectors while making sure that the most vulnerable citizens and micro-enterprises are effectively supported in the climate transition.

Marian Jurečka, Czech Environment Minister Marian

At stake was the EU’s ability to contribute to global efforts to combat climate change and meet its target of reducing net greenhouse gas emissions by 55 percent by 2030 compared to 1990 levels. Meeting this target requires the EU’s carbon market must be reformed to reduce emissions faster which will be done by requiring around 10,000 power plants and businesses to buy permits for the carbon dioxide they pollute the air with.

Negotiators were at odds over how quickly to end the free carbon dioxide emission permits the EU gives to industries to protect them from foreign competition. These permits will phase out as the EU gradually introduces a carbon border tax aimed at preventing domestic companies from being undercut by competition from overseas companies.

The agreement reached has yet to be officially approved by the European Parliament and the European Council. It also envisages the creation of a Social Climate Fund to help the most vulnerable households, micro-enterprises and transport users deal with the price effect of an emissions trading system.

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