EU negotiators grant industry more free emission certificates

Negotiators from the European Parliament and EU member states agreed to provide the industrial sector with 120 million additional free emission trading certificates between 2026 and 2030.

This agreement exceeds a previous proposal from the European Commission, which would have saved affected companies about 6 billion euros. The extra certificates aim to prevent companies from moving their operations to countries with looser climate rules.

The European Union uses the Emissions Trading System to set limits on greenhouse gas emissions in energy-heavy sectors like power generation. Companies must present certificates for every ton of carbon dioxide they release, creating a cost for pollution. The European Commission must still issue specific rules for calculating the values of these certificates after the Parliament and member states formally approve the compromise.

This move comes as the European Union works toward a goal to reduce greenhouse gas emissions by 90 percent by 2040 compared to 1990 levels.