Finnish Industries: EU ETS decisions should align climate ambition with clean economy investment

In the view of Finnish business, the EU Emissions Trading System (ETS1) must remain the cornerstone of the EU’s climate and energy policy also in the future. It should be reviewed in a way that aligns climate objectives, investment certainty and the competitiveness of European companies. The Confederation of Finnish Industries EK is today hosting a roundtable discussion in Helsinki, bringing together EU Commissioner for Climate, Net Zero and Clean Growth Wopke Hoekstra and Finnish business leaders.

Review of the EU Emissions Trading System (EU ETS 1) for the 2031–2040 period is one of the most significant climate and industrial policy initiatives on the EU agenda this year. Finland has much to contribute to the EU decisions ahead in the coming months, as Finnish companies are among Europe’s frontrunners in low-emission industry, the electrification of society and clean transition innovations.

“Emissions trading has long been the cornerstone of Europe’s climate and energy policy, and its central role and consistent direction must be safeguarded on the path towards 2040. The system should be improved by better aligning climate, competitiveness and investment certainty considerations,” says Minna Helle, Director General of Finnish Industries EK.

EK’s recommendations for reviewing the EU ETS:

• Ensure that emissions trading remains a market-based, technology-neutral and cost-effective policy instrument in the future in align with the EU climate targets. We are calling for reforms that align climate objectives with investment certainty and the competitiveness of Europe’s clean economy.
• New technologies are needed for the clean transition. Finnish Industries supports the Commission’s proposal to strengthen the role of carbon capture and permanent carbon removals in the EU ETS.
• Revenues generated from emissions trading should be used to support the decarbonisation of industries, electrification, the hydrogen economy and new clean technologies.
• European companies operating in global competition will continue to need free allocation of emission allowances to compensate for competitiveness impacts, while ensuring coherence with the Carbon Border Adjustment Mechanism CBAM.
• The EU ETS for aviation should remain limited to intra-EU flights. The additional costs caused by winter navigation in maritime must be addressed on a permanent basis. Support schemes for sustainable fuels need to be sufficient enough to phase-out fossil fuels.