Renewable energy generator Statkraft, along with seven other major European energy companies, has issued a joint call to safeguard the EU ETS. In a collaborative letter to European Commission President Ursula von der Leyen and European Council President António Costa, Statkraft, Fortum, Vattenfall, Iberdrola, EDP, Ørsted, EDF and Engie warn EU leaders against dismantling market mechanisms that provide the ‘price signal’ necessary for renewable energy investment. They argue that predictable policy is the only way to ensure the long-term affordability and security of Europe's power supply.

‘Weakening the EU ETS will not solve Europe’s competitiveness challenges. On the contrary, it can lead to increased uncertainty and slow down the power sector investments Europe urgently needs. The EU has already decided to reduce its emissions by 90% by 2040. The EU ETS delivers a clear and credible price signal that guides long‑term investment into renewable power, flexibility and electrification. It is the backbone of Europe’s net zero strategy,’ says Birgitte Ringstad Vartdal, President and CEO of Statkraft.  

The letter highlights that ETS revenues support European industry through transition and electrification without putting additional pressure on public finances. The companies encourage EU leaders to enable efficient redistribution of ETS revenues and to establish the Industrial Decarbonisation Bank announced under the Clean Industrial Deal. The companies stress that Europe stands at a critical crossroads: ‘Either accelerate the energy transition and innovation to close the competitiveness gap, or risk undermining decades of progress in European energy and industrial transformation.’

The CEO of European energy company Vattenfall, Anna Borg, has taken a firm stance, stating: ‘Don’t mess with ETS.’ The company argues that short-term interventions to lower carbon prices would only shift costs to future generations and state budgets. Vattenfall likens abandoning the ETS to stopping the insulation of a house halfway through because it feels expensive – only to face much higher repair and energy costs later.

‘Regulatory stability is not a nice to have; it is what enables the massive investments required for the transition. Keep marginal pricing and the ETS as the pillars of the transition intact and give businesses the regulatory certainty needed to keep Europe in the lead. Only a decarbonised Europe is a competitive Europe,’ Borg adds.

Analysis from European think-tank Bruegel characterises the ETS as an ‘ally, not an enemy’ of industrial competitiveness. The report warns that weakening the carbon market would create a ‘laggard’s dividend’, penalising companies that invested early in green technology. Bruegel suggests evolving the system from ‘cap-and-trade’ to ‘cap-and-invest’, using auction revenues to fund a ‘strong industrial decarbonisation bank’ to scale low-carbon investments.

In a keynote address at the 2026 EIB Group Forum, European Council President António Costa declared 2026 the ‘year of European competitiveness’. Addressing high energy costs, Costa clarified that the EU ETS is responsible for only a small fraction of the price gap between Europe and its global competitors like China and the US. He argued that the true culprit is a continued reliance on imported fossil fuels and urged the completion of a ‘One Market for One Europe’ to scale clean energy solutions.

Climate think-tank E3G states that the EU ETS is essential for a secure Europe. Its analysis refutes claims that carbon pricing is the primary driver of high energy prices, noting that fossil fuel volatility is the real threat. E3G emphasises that the ETS generates substantial fiscal revenue and that the industry has reportedly received four times more support through ETS-funded innovation than it has paid in carbon costs since 2021.

The revision of the EU ETS will determine its shape beyond 2030. Following the Commission proposal in 2026, the Council and European Parliament said they will start negotiating on the future of the EU ETS.

Additionally, a separate system (ETS2) for road transport and buildings is set to begin in 2028, eventually bringing the total coverage of EU emissions to 75%.