The EU Emissions Trading System (EU ETS) is under direct political pressure. Industrial competitiveness is high on the agenda across Brussels and member states. Large industrial actors and member states are actively engaging in the debate about the future of the EU ETS, and have flagged concerns about high carbon costs and the carbon price impact on electricity prices and competitiveness.
In the European Commission’s legislative proposal to review the EU ETS Directive in light of the EU’s 2040 climate target, expected in July, key design elements are under revision.
The key design elements include:
Read our analysis: EU ETS Carbon Price Outlook Under a 3.4% Linear Reduction Factor (February 2026)
Uncertainty on the future design and set-up of the EU ETS is already shaping expectations, positioning, and price formation.
Market participants are facing critical questions:
These questions can only be answered by combining cross-market modelling with close insight into how policy design is evolving in Brussels.
Above: The EU ETS Scenario Viewer, part of the complete EU ETS Intelligence Solution, shows how potential changes to the cap, MSR, or other elements impact prices.
The EU ETS Scenario Viewer is an interactive tool within the Veyt Market Intelligence Platform that enables users to quantify policy design options and answer key questions about how potential changes to the EU ETS market set-up will impact their investments, portfolios, and revenues or costs.
The Scenario Viewer allows you to compare different policy design scenarios to see their specific impact on demand, supply, market balance, and price trajectories.
The tool consists of three main elements:
Beyond these pre-defined scenarios — which are updated dynamically as the debate in Brussels evolves — Veyt also provides ongoing policy updates and custom modelling for specified parameter combinations relevant to the ETS review process, helping clients assess the specific effects of potential policy shifts or price sensitivities on their unique portfolios.
When the European Commission proposes structural changes, the impact is felt across the entire curve as the market prices in future expectations. The faster companies can interpret the potential changes stemming from the policy process, the faster they can react to opportunities.
Veyt’s Scenario Viewer combines detailed modeling with policy analysis to help clients stay ahead of market changes. By accessing these tools directly through the Veyt platform, you can identify new opportunities early and update your strategy as the market moves. We focus on looking forward, using our understanding of the policy landscape and conversations with policymakers to help you determine your next move.
Our teams constantly update our forecasts as regulations evolve and new policy frameworks take shape. This keeps your strategy aligned with the most current state of the market.
Talk with our analysts about interpreting and timing of EU ETS policy changes, or request a walkthrough of the scenario viewer: Book a demo
A weekly cap of what moved EUA prices and a clear view of the week ahead. We set out the drivers, their directional impact, and what matters next.
Specialising in data, analysis, and insights for all significant low-carbon markets and renewable energy.
