Is the EP inching towards a strengthened ETS price control?

A draft compromise text seen by Veyt suggests that Peter Liese, the European Parliament’s rapporteur on the Emissions Trading System (ETS) review, continues his push to reinforce the price control mechanism in Article 29a of the ETS Directive. The mechanism is meant to curb price volatility and prevent persistently high prices by releasing allowances from the Market Stability Reserve, but has not been activated a single time, and the Commission’s 17 July review proposal envisages no changes to the current set-up.

The analysis sets out how the draft compromise, prepared for discussion with the shadow rapporteurs on 3 November, would change the trigger, release volumes, and frequency of interventions, how it would have performed against past price movements, where the Commission, political groups, and market participants stand, and what it could mean for European Union Allowance (EUA) prices.