Statkraft Joins Leading Power Companies in Call to Safeguard EU ETS and Strengthen Europe’s Competitiveness

Why It Matters

Safeguarding the ETS and market integration ensures the policy certainty required for massive renewable and industrial decarbonisation investments, directly affecting Europe’s global competitiveness and energy affordability.

Key Takeaways

• EU ETS provides price certainty for renewable investments
• Companies warn against dismantling marginal pricing mechanisms
• ETS revenue could fund industrial decarbonisation
• Letter urges swift creation of Industrial Decarbonisation Bank
• Protecting internal electricity market sustains competitiveness

Pulse Analysis

The European Union’s Emissions Trading System has become the cornerstone of the bloc’s climate strategy, translating carbon reduction targets into a market‑based price signal. By capping overall emissions and allowing permits to trade, the ETS incentivises utilities and industrial players to shift toward low‑carbon generation. Recent political discussions, however, have raised the spectre of weakening the scheme to ease short‑term cost pressures. Statkraft and seven peers argue that such a move would erode investment certainty, jeopardising the billions needed to meet the EU’s 90 % emissions cut by 2040.

Beyond the carbon price, the EU’s integrated electricity market relies on marginal pricing to allocate generation at the lowest cost while signalling where new capacity is required. This mechanism has delivered lower consumer bills, higher system efficiency, and greater security of supply across member states. The signatories warn that fragmenting the market or diluting marginal pricing would raise wholesale prices and diminish cross‑border trade benefits. Preserving these proven market tools, they contend, is essential for attracting private capital into wind, solar and storage projects that underpin Europe’s net‑zero pathway.

Finally, the letter highlights the untapped potential of ETS revenue as a financing lever for industry‑wide decarbonisation. By channeling proceeds into the proposed Industrial Decarbonisation Bank, the EU could subsidise electrification upgrades without expanding public debt. This approach aligns with the Clean Industrial Deal’s goal of keeping European manufacturers globally competitive while meeting climate targets. Statkraft’s coalition therefore urges swift legislative action to safeguard the ETS, maintain market integration, and unlock the fiscal tools needed to fund the next wave of clean‑energy investment.