Decision (EU) 2023/852 amending Decision (EU) 2015/1814 as regards the number of allowances to be placed in the market stability reserve for the Union greenhouse gas emission trading system until 2030

Summary:

Decision (EU) 2023/852 - formally adopted by the co-legislators on 19 April 2023 - introducing amendments to Decision (EU) 2015/1814 as regards the number of allowances to be placed in the Market Stability Reserve (MSR) for the European Union's (EU) greenhouse gas emission trading system (EU ETS) until 2030. This is a text with EEA relevance.

Further information:

Decision (EU) 2015/1814 established and laid out the rules for the operation of a Market Stability Reserve (MSR). The MSR was designed to address the market imbalance of the EU ETS and improve its resilience to future unexpected and sudden demand shocks. It has been operational since 2019.

The Communication setting out the European Green Deal from December 2019 introduced a new growth strategy for the European Union (EU). It reaffirmed the European Commission's ambition to increase its climate targets and achieve climate neutrality by 2050. These targets were further updated in September 2020 in the Climate Target Plan, which became legally binding with the European Climate Law. The Fit for 55 legislative package was the result of the review carried out by the Commission on the EU's climate and energy legislation in view of the targets adopted in the meantime.

The revision of the framework establishing the MSR arose from proposed modifications to the EU ETS in the context of Fit for 55, external factors affecting supply and demand, as well as the requirement that the European Commission reviews the functioning of the instrument. The Decision prolongs beyond 2023 the increased annual intake rate of allowances.

The draft law was adopted by the European Commission on 14 July 2021, as part of the Fit for 55 legislative package. The plenary of the European Parliament endorsed a negotiating position on 5 April 2022. The Council of the European Union adopted its general approach to the file on 25 June. An informal agreement between the co-legislators on a compromise text for this draft law was reached on 18 December. This was formally endorsed by the Parliament on 14 March and by the Council on 28 March. The Act was signed by the co-legislators on 19 April 2023 and published in the Official Journal on 25 April 2023.

• Primary Source

Commentary and Analysis

European Parliamentary Research Service (EPRS): Briefing, February 2023: Revision of the market stability reserve for the EU emissions trading system https://www.europarl.europa.eu/thinktank/en/document/EPRS_BRI(2022)698896

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Official

EUR-LEX: COM(2021)571: Proposal for a Decision amending Decision (EU) 2015/1814 as regards the amount of allowances to be placed in the market stability reserve for the Union greenhouse gas emission trading scheme until 2030 https://eur-lex.europa.eu/legal-content/EN/ALL/?uri=COM:2021:571:FIN

EUR-LEX: SWD(2021)552: Staff Working Document accompanying the Proposal - Subsidiarity Grid https://eur-lex.europa.eu/legal-content/EN/ALL/?uri=SWD:2021:552:FIN

European Parliament: Legislative Observatory: Procedure File for Proposal on Revision of the Market Stability Reserve for the EU Emissions Trading System (2021/0202(COD)) https://oeil.secure.europarl.europa.eu/oeil/popups/ficheprocedure.do?lang=en&reference=2021/0202(COD)

European Parliament: Legislative Train Schedule: Revision of the EU ETS Market Stability Reserve as part of the European Green Deal https://www.europarl.europa.eu/legislative-train/theme-a-european-green-deal/file-revision-of-the-eu-ets-market-stability-reserve

European Commission: European Green Deal: Increasing the ambition of EU emissions trading https://climate.ec.europa.eu/eu-action/european-green-deal/delivering-european-green-deal/increasing-ambition-eu-emissions-trading_en

European Commission: Press Release, 14/07/2021: European Green Deal: Commission proposes transformation of EU economy and society to meet climate ambitions https://ec.europa.eu/commission/presscorner/detail/en/ip_21_3541

European Parliament: Press Release, 15/03/2022: ETS: Environment MEPs want to extend the Market Stability Reserve to 2030 https://www.europarl.europa.eu/news/en/press-room/20220309IPR25167/

European Parliament: Press Release, 05/04/2022: “Fit for 55”: Parliament wants to extend the Market Stability Reserve to 2030 https://www.europarl.europa.eu/news/en/press-room/20220401IPR26541/

Council of the European Union: Press Release, 18/12/2022: 'Fit for 55': Council and Parliament reach provisional deal on EU emissions trading system and the Social Climate Fund https://www.consilium.europa.eu/en/press/press-releases/2022/12/18/fit-for-55-council-and-parliament-reach-provisional-deal-on-eu-emissions-trading-system-and-the-social-climate-fund/

European Parliament: Press Release, 14/03/2023: Climate change: Parliament extends the Market Stability Reserve to 2030 https://www.europarl.europa.eu/news/en/press-room/20230310IPR77241/

Council of the European Union: Press Release, 28/03/2023: ‘Fit for 55’: Council adopts decision on market stability reserve https://www.consilium.europa.eu/en/press/press-releases/2023/03/28/fit-for-55-council-adopts-decision-on-market-stability-reserve/

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