PM criticises EU Emissions Trading System in Euractiv article

euractiv.com

Poland’s prime minister has said the EU's Emissions Trading System (ETS) is fundamentally flawed and in need of “profound” reform.

In an article published on the Euractiv website, Mateusz Morawiecki wrote that the EU "is facing a moment of crucial decisions," one of which, he argued, was what to do about the CO2 trading system.

He laid out a litany of problems he argued beset the ETS.

"The price increase is out of control and hitting the household budgets of EU citizens," Morawiecki wrote. "It threatens the financial security of ordinary people, which has already suffered from the pandemic crisis. Above all, it undermines citizens’ confidence in the EU’s climate policy concept."

The prime minister went on to say that European Commission President Ursula von der Leyen had recently indicated that "the end justifies the means."

"It is contrary to the assumptions of a fair energy transition, which is defended by Poland and other countries," Morawiecki wrote. "The thesis that an increase in emission prices, and thus a drastic increase in energy bills, is the right direction that does not require adjustments, in fact, means a green light to further speculative functioning on the EU system."

He noted that in Von der Leyen's view, "the rising price of certificates is a strong economic incentive for companies to become more efficient and switch to clean production."

"Correct, this is the logic of reducing emissions, but the ETS was meant to encourage companies to evolve rationally, not to impose a pace that threatens their growth.

"A rapid rise in prices will not be a positive incentive, but a barrier that will prevent thousands of companies from operating," wrote the prime minister. "Another consequence is the growing opposition of European societies, which may rise up in revolt against the gigantic costs of an unfair energy transition."

Given the problems of the ETS, Morawiecki said he considered it "necessary to carry out a profound reform of the ETS system, which will take into account the current situation on the energy market and the market for emission allowance."

One step, Morawiecki wrote, would be to build "appropriate regulatory and supervisory solutions, and we must cut through the speculative bubble that has built up around ETS trade."

"he ETS needs to be changed also so that its path no longer resembles Bitcoin, where we see a lot of speculation," he added. "Such an economy is not healthy, as it is our citizens who pay for it in the first place."