The prime minister and four other EU heads of government wrote this Thursday, March 12, to the president of the European Council asking him not to weaken the EU carbon market, in the face of calls for its suspension due to energy prices.
In the letter, to which Lusa had access, the prime ministers of Portugal, Spain, Sweden, Finland and Denmark warn that “attempts to weaken, suspend or limit the European Union’s Emissions Trading Scheme (CER) would undermine investor confidence, penalize pioneers [das energias renováveis]would distort the level playing field and slow down the transformation of our economies.”
These five Member States, among those that produce the most renewable energy, emphasize that the European Union (EU) CER is the “cornerstone of Europe’s climate and industrial strategy” and remains the “most effective and efficient instrument to reduce emissions and guide investments”.
This letter comes a week before the European Council summit and at a time when countries more dependent on fossil fuels, such as Italy or Poland, have asked for a review and suspension of the European Union (EU) carbon market, as they consider it to be artificially inflating the price of energy in the current context of war in the Middle East.
In the letter, the five leaders argue that next week’s summit represents a “crucial opportunity” for the EU to reaffirm its “collective commitment to climate ambition and the instruments that make it predictable”.
“A strong, predictable and integrated climate and energy framework, based on a robust CER in conjunction with our competitiveness efforts, is essential for Europe’s future. We trust that the conclusions [da reunião] reflect this vision and define the direction for decisive action in the coming months”, he said.
The heads of Government warn against any attempt to reduce the ambition of the RCE, such as halting the progressive elimination of free licenses offered to certain industrial sectors so that they do not have to deal with excessively high costs.
“The gradual elimination of free licenses is imperative to ensure that there are incentives for the industry to make the transition and decarbonize the economy while preserving its competitiveness”, they state.
Luís Montenegro and the remaining four prime ministers admit that “technical adjustments” may be appropriate to “reduce volatility”, but warn that this “should not compromise the integrity or predictability of the system”.
In the letter, the five prime ministers state that Europe’s limited access to fossil fuels and its exposure to geopolitical pressures makes decarbonization an “economic imperative.”
“Reducing our dependence on fossil fuels strengthens our resilience, reduces our structural energy costs and increases our autonomy”, they say.
The heads of Government consider that their five countries have shown that “energy free from fossil fuels leads to lower prices and greater stability”.
In addition to this letter, the Portuguese Government also signed an informal document today, also signed by the executives of Spain, the Netherlands, Luxembourg, Slovenia, Denmark, Finland and Sweden, in which it is warned that “making fundamental changes to the RCE, calling into question the instrument itself or suspending it would constitute a very worrying setback”.
The EU heads of state and government will meet next Thursday and Friday in Brussels at a European Council summit in which the issue of energy should be a central topic, given the rise in prices resulting from the war in the Middle East.
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