The EU successful carbon permit regime will be extended to more industries, further reducing damaging emissions.
The European Union passed this week an important piece of legislation regarding carbon emissions permits. The permits regime will be extended to new heavy industries, further reducing their carbon footprint.
Carbon permits were introduced in 2005, essentially charging the target industries for every ton of carbon emission they produced. So far, this regime has decreased emissions from such industries by 43%, according to Reuters. The goal of EU lawmakers is to bring that number to 62% by 2030.
Until now, the industries targeted by the bill were power generation and heavy industry. The bill passed into law this Tuesday by the European Parliament extends carbon permits to air and maritime transport.
Currently, the price of carbon permits is €88 for every ton of emissions produced. The European Union plans to use the funds raised with these permits to ease transition to renewable sources of power.
Specifically, this transition fund is planned to reach €86.7 billion.
The new law also plans to extend a tax on emissions-heavy imported goods, including steel, cement, electricity, aluminum and fertilizers. This limitation on imports should enter into full effect starting from 2026.
The law was passed with 24 out of 27 member states voting in favor. Poland and Hungary were the only countries to vote against. Poland has often accused Brussels of setting unrealistic climate goals that defy industry activities. Hungary, on the other hand, often goes against EU decisions for internal politics reasons.
The general plan
The European Union is by far the strongest advocate for climate transition, at least according to the several green reforms passed in these years.
Last November, the EU approved a ban on petrol-car sales starting from 2035. Though this ban does not affect existing petrol-cars, which will still be legal to drive, it forbids selling new ones.
Also last year, the EU discussed a bill regarding the ban of imports from deforested areas. The law would prevent goods like meat or cereals grown in recently deforested areas from reaching the European Union.
The bill aims, in particular, at limiting deforestation in countries like Brazil, whose destruction of the Amazon rainforest stems from an expansion of the food industry.
The overall plan is for the EU to reach carbon neutrality by 2050. This goal is similar to other major economies, including the United States, China and India. The European Union, however, seems to be the region with the fastest growing set of policies to concretely reach the goal.
