Estonia wants free ETS emission credits to continue after 2040
Estonia calls for extending free EU emission allowances beyond 2040 and preserving member states' discretion over revenue use.
Estonia's position on EU ETS changes
The European Commission will publish its proposals for changes to the Emissions Trading System (ETS) later this week. Estonia is advocating for countries to retain the ability to decide how to use revenue from the sale of carbon allowances domestically. Under the current directive, ETS allowances would fall to zero before 2040, but Estonia wants free allowances to be available after that date.
This is crucial for Estonia because its oil shale power plants currently benefit from free allowances and do not have to pay for all their emissions. The state seeks an extension of the system beyond 2040. Additionally, Estonia insists that member states should maintain freedom in using ETS revenues and that administrative burdens on companies and countries should be reduced.
The exact proposals are not yet known, but it is likely that the allocation of free ETS allowances will be extended and rules on revenue use clarified. Estonia plans to finalize its position by October, when EU environment ministers meet. An agreement among member states is expected by December.
