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The European People‘s Party (EPP), the largest political group in the European Parliament, has refined its position on the Commission’s review of the Emissions Trading System (EU ETS). On aviation, the EPP reiterates that the current geographical scope of the EU ETS should be maintained, limiting its application to intra-European flights. However, the group introduces an important qualification, stating that this approach should remain in place unless a “smart solution“ can be found that safeguards the competitiveness of European regions, airlines, and airports.

The EPP has also strengthened its support for the introduction of a so-called book-and-claim mechanism for Sustainable Aviation Fuels (SAF). Under the current ETS framework, airlines can only benefit from emissions reductions if sustainable fuels are physically supplied to the aircraft. A book-and-claim system would allow the environmental attributes of SAF to be traded separately from the physical fuel, helping to stimulate SAF production and uptake while providing greater flexibility for airlines and their customers. The inclusion of this point marks a notable addition compared with earlier draft positions and reflects growing political support for more flexible market-based mechanisms to accelerate aviation decarbonisation.

For the maritime sector, the EPP calls for the ETS revision to include a corrective mechanism to address the risk of carbon leakage through the diversion of container traffic to transhipment hubs outside the European Union. The proposal seeks to prevent shipping lines from restructuring routes to avoid ETS costs, an issue that has become increasingly prominent since the maritime ETS entered into force.

The EPP has appointed German MEP Peter Liese as Parliament‘s rapporteur for the upcoming ETS revision. As the EPP coordinator in the Environment Committee (ENVI) and rapporteur for the previous ETS reform adopted in 2023, Liese brings significant experience to what is expected to be one of the most closely watched climate files of this legislative term.

The Commission‘s legislative proposal published today will launch negotiations between the Parliament and the Council on the future development of the EU carbon market, with important implications for freight transport, logistics, as well as aviation and maritime operators across Europe.