Not only companies but also consumers will soon have to pay for greenhouse gas emissions such as carbon dioxide (CO2). A newly established social climate fund is intended to minimize the impact of the energy transition on citizens.
The agreement reached now concerns not only the Fitfor55 Climate Law but also the consequences for other EU legislation. The approved projects form the core of the “Fit for 55” package that the European Commission presented in the summer of 2021.
The goal is to help the countries of the European Union reduce carbon dioxide emissions by 55 percent by 2030 and ultimately become carbon neutral. The accord still needs to be ratified by the European Parliament and the member states, but this is considered a formality.
Specifically, the negotiators agreed to tighten the existing ETS emissions trading system. The current free emission allowances will be phased out more quickly, and there will be fewer certificates in circulation. This should motivate companies to produce less carbon dioxide.
Additionally, the ETS system will also apply to the transport sector, starting with major sea and shipping transport.
There will also be a penalty for non-insulated homes and buildings. EU countries and housing corporations must accelerate making their housing more energy-efficient. An EU subsidy will be provided for this.
The consequences for tenants and consumers, such as rising heating costs, must be compensated by a new European 'social climate fund.' Eighty-six billion euros will be made available for this from the sale of emission rights to companies. The EU countries must report on this annually to Brussels.