[EN] Conditionalities, Earmarking, Frontloading : How to Get the White Smoke on ETS

Introduced in 2005, the European Union Emissions Trading System (EU ETS) was initially presented as the “spearhead” and “one of the most important instruments of EU climate policy”.

Two decades and multiple reforms later, it has become a « cornerstone” of the European Green Deal. Yet its political and economic environment has shifted markedly.

In the aftermath of the 2024 European elections and successive energy shocks, the centre of gravity of EU policymaking has tilted from climate ambition toward industrial competitiveness.

In this context, carbon pricing is, again, increasingly perceived and portrayed not as a driver of transformation, but as a potential liability – an additional cost burden for energy-intensive industries already exposed to international competition.