Fit for 55: Parliament set to adopt key laws to reach 2030 climate target 

MEPs will vote on the reform of Emissions Trading System including for aviation and the maritime sector, the Carbon Border Adjustment Mechanism and a new Social Climate fund.

Following a debate on Monday, Parliament will vote on Tuesday on the deals reached with EU countries in late 2022 on several key pieces of legislation that are part of the “Fit for 55 in 2030 package”. This is the EU’s plan to reduce greenhouse gas (GHG) emissions by at least 55% by 2030 compared to 1990 levels in line with the European Climate Law.

Emissions Trading System (ETS)

The deal on the reform of the Emissions Trading System (ETS) increases the ambition for 2030, phases out free allowances to companies and creates a separate new ETS II for fuel for road transport and buildings that will put a price on emissions from these sectors by 2027.

Parliament will also vote on including GHG emissions from the maritime sector in the ETS and to revise the ETS for aviation.

Carbon Border Adjustment Mechanism (CBAM)

According to the agreement with EU countries, an EU Carbon Border Adjustment Mechanism (CBAM) will be set up to ensure that importers of goods covered by the EU ETS would have to pay any price difference between the price paid for carbon in the country of production and the price of carbon allowances in the EU ETS. This will incentivise non-EU countries to increase their climate ambition and ensure that EU and global climate efforts are not undermined by production being relocated from the EU to countries with less ambitious policies.

Social Climate Fund (SCF)

A separate deal with member states sets up an EU Social Climate Fund to ensure that the climate transition will be fair and socially inclusive. Vulnerable households, micro-enterprises and transport users who are particularly affected by energy and transport poverty will benefit from the fund. When fully in place, it will be funded from auctioning ETS II allowances up to an amount of €65 billion, with an additional 25% covered by national resources (amounting to an estimated total of €86.7 billion).

Procedure codes: 2021/0211A(COD), 2021/0211B(COD), 2021/0214(COD), 2021/0206(COD), 2021/0207(COD)

Debate: Monday 17 April 2023

Vote: Tuesday 18 April 2023

Press conference with the rapporteurs Peter Liese (EPP, DE), Esther de Lange (EPP, NL), David Casa (EPP, MT), Mohammed Chahim (S&D, NL): Tuesday 18 April, 14.00

Procedure: Ordinary legislative procedure, first reading agreements