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S&Ds: With the approval of the revision of the Market Stability Reserve for the EU-ETS, we set today the tone for the upcoming Fit for 55 files

Date

05 Apr 2022

Sections

Climate & Environment

The S&D Group welcomes the adoption by the European Parliament of the important revision of the Market Stability Reserve (MSR) for the EU Emissions Trading System (ETS), the first legislative file of the European Commission’s Fit for 55 package.

The MSR, operational since 2019, addresses the structural imbalance between the supply and demand for allowances in the market and stabilises the market by removing surplus allowances from it. The reserve functions by triggering adjustments to the annual auction volumes. The amending Directive (EU) 2018/410 doubled until 2023 the intake rate from 12 % to 24 %, and the minimum amount to be placed in the reserve from 100 to 200 million allowances.

Rapporteur and S&D member, Cyrus Engerer, declared:

“In these unprecedented times, the stability in the market is key for all households and businesses in the European Union. It was with this in mind that we worked at a fast pace to ascertain the current intake rate and allocations beyond next year and at least until 2030.

“With the first legislative report from the Fit for 55 package, we wanted to set the tone for the other upcoming reports, making it clear that our ambitions must not be compromised, while we ensure a just transition that also protects the most vulnerable in our society. Europeans citizens deserve and want stability. As Parliament, we are delivering. The ball is now in the Council’s court to do the same.”

S&D coordinator of the environment committee, Tiemo Wölken, said:

“With the adoption of this first report from the biggest climate legislation package the EU has ever seen, the Parliament kicks-off on increasing climate ambition. We will do our utmost to quickly follow suit with the other files and increase the Commission’s climate ambition proposal. This is urgently needed, as the Intergovernmental Panel on Climate Change (IPCC) reports show.

“The EU-ETS was for too long flawed with loopholes and surplus certificates. This cannot be repeated. At the same time, the Market Stability Reserve can play an important role against the spiralling of prices. It is important that we put the overhauled EU-ETS on a stable foundation.”

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