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News from Brussels
This week, the European Commission approved Sweden’s request, submitted in July, to extend its carbon market to the rail freight and passenger sectors. Sweden joins Austria and the Netherlands, which have similarly expanded ETS2.
As part of the 2023 revisions to the ETS Directive, the EU introduced ETS2, a new emissions trading system addressing CO2 emissions from fuel combustion in buildings, road transport, and other sectors not covered by the existing ETS. The Directive allows Member States to unilaterally extend ETS2 to additional sectors or sub-sectors.
Sweden highlighted that including rail transport in ETS2 would promote more uniform carbon pricing and facilitate a cost-effective climate transition. The decision is also expected to reduce administrative burdens and simplify reporting and monitoring for regulated entities and national authorities.
The decision and its annex can be accessed here.