The struggle to put a price on climate change

Fossil fuel intensive industries will soon have to pay for their greenhouse emissions, according to the new Europe-wide carbon emissions trading scheme (ETS2). However, the design of ETS2 puts most of the financial burden on the shoulders of individual consumers.

In this episode of Today in the EU, Economy and Transport reporter Jonathan Packroff analyses this latest addition to the EU carbon market and what it means for the future of the union's citizens.  

• The European Union is implementing a new carbon emissions trading scheme called ETS2, which will require fossil fuel-intensive industries to pay for their greenhouse gas emissions.

• The scheme will initially cover electricity generation, large industrial plants, aviation, and maritime transport. It will be extended to include buildings and road transport.
• The aim of the system is to incentivise the switch to cleaner energy sources and reduce emissions.
• The financial burden of the scheme is expected to fall on consumers as industries pass on the cost through higher prices for goods and services.
• The impact on the general public is difficult to estimate but could result in increased costs for petrol, diesel, and heating.
• The EU plans to set a limit on the carbon price and allocate funds to member states to support vulnerable households in transitioning to cleaner technologies.
• The introduction of ETS2 has faced opposition from some political parties, and ETS2 is seen as a market-based alternative to outright bans on fossil fuel use.