EU countries clash over carbon price amid high energy prices
Italy and allies want more scope for temporary relief, while other countries want to preserve the climate incentive.
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EU leaders are discussing this week how to curb high energy prices without hollowing out the emissions trading system. Proposals to temporarily relax the carbon market in particular are causing division.
The leaders of the 27 EU countries will meet in Brussels on 15 and 16 October to discuss energy prices and the competitiveness of European companies. According to the European Council’s agenda, the Commission must propose measures to limit the short-term effects of high energy prices.
Italy and Czechia submitted proposals to the Commission in advance. They include greater flexibility in the allocation of emission allowances, stricter oversight of the carbon market and a postponement of ETS2. That new system is also due to introduce a carbon price for fuels used in buildings and transport from 2028.
Supporters of relief point out that higher energy prices affect consumers and energy-intensive companies. Italy warns that the current rules could increase the cost of electricity and put European producers at a disadvantage compared with companies outside the EU.
Opponents fear that temporary interventions will undermine the purpose of emissions trading. The EU ETS is intended to make pollution more expensive and encourage companies to switch to cleaner production. Reduced scarcity in the market could weaken the price incentive and delay investment.
The European Commission published an average ETS price of €78.93 per emission allowance for the preceding six months in October. This is a technical reference for the European protection rules, not a fixed consumer price. The leaders have not yet reached agreement on an adjustment; the Commission must develop possible measures further.
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One story, several perspectives
What is established
- EU leaders are discussing high energy prices and competitiveness.
- Italy and Czechia have proposed temporary adjustments to the carbon market.
- The European Commission has not yet announced a definitive change to the ETS or ETS2.
Left
Arguments The climate price must be maintained. High energy prices are above all a reason to provide targeted help to households and invest more quickly in insulation, renewable energy and public transport, not to make pollution cheaper.
Values Climate responsibility, protection of vulnerable households and a fair distribution of the costs.
Consequences Relaxation could delay investment in clean technology and keep emissions high for longer; targeted support can limit the bill without removing the climate incentive.
Centre
Arguments The EU must uphold its climate targets, but temporary market mechanisms may be necessary during exceptional price shocks. Any intervention must be measurable, limited and subject to oversight.
Values Administrative feasibility, predictability for companies and protection of purchasing power.
Consequences A limited adjustment could cushion economic damage, but complex exceptions could make the market less transparent.
Right
Arguments The EU must keep energy affordable and reliable before imposing new costs. A carbon price that makes production and transport more expensive could affect European companies and consumers without reducing global emissions proportionately.
Values Affordability, competitiveness, national policy space and energy security.
Consequences Postponement or relief could reduce economic pressure, but could also lead to slower decarbonisation and greater uncertainty about climate policy.
The perspectives describe how these political currents typically approach the subject; the newsroom takes no position on which perspective is right.
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The agenda, the Italian and Czech proposals and the ETS reference figures can be found in public sources. The article makes clear that the political outcome remains open.
- confirmed EU leaders are discussing energy prices and competitiveness on 15 and 16 October. — Included in the European Council’s agenda. source
- confirmed Italy and Czechia proposed, among other things, postponing ETS2. — Reuters describes the joint proposal ahead of the summit. source
- confirmed The six-month average ETS price was €78.93 in October. — Published by the European Commission. source
- confirmed There is still no agreement on relaxing the ETS or postponing ETS2. — The public agenda and reporting describe proposals and discussion, not a definitive decision. source
Editor's note
The summit and the proposals have been confirmed. There is still no decision on relaxing the ETS or postponing ETS2.Sources
- European Council – October 2026 — Raad van de Europese Unie
- Italy and Czech Republic to call for softer EU rules on carbon permits, energy supply — Reuters via AOL
- Auctioning of allowances — Europese Commissie
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