More than 100 European companies and investors have urged European Union leaders to maintain the strength of the EU Emissions Trading System (EU ETS), warning that weakening the bloc’s carbon market could undermine industrial competitiveness and slow the transition to clean industry.
The appeal was made in a joint letter sent to EU heads of state ahead of the European Council summit scheduled for March 19–20.
Signatories include major industrial companies such as Salzgitter AG, Tata Steel, Outokumpu, Saarstahl AG and SSAB, alongside a number of investors and clean-technology firms.
The companies stressed that foundational industries such as steel, cement, chemicals, glass and aluminum remain essential to Europe’s economic security, while emerging sectors like renewable energy, batteries, electrolyzers and power grid technologies are critical for the future clean-energy economy.
According to the letter, the EU ETS plays a central role in supporting Europe’s transition to a low-carbon industrial system by creating a market-based price on carbon emissions.
The signatories warned that weakening the system could reduce investment certainty, penalize companies that have already invested in decarbonization technologies and weaken Europe’s competitiveness in emerging clean-industrial sectors.
Instead of weakening the carbon market, the companies called on policymakers to improve how revenues from the ETS are used.
While EU member states collect most of the revenues generated by carbon allowance auctions, the letter noted that only a limited share of these funds is currently reinvested in industrial decarbonization projects.
The companies therefore urged governments to direct a larger portion of ETS revenues toward clean industrial development, particularly projects related to electrification, renewable energy expansion and industrial energy efficiency.
They also highlighted additional priorities for strengthening Europe’s industrial competitiveness, including expanding affordable clean electricity generation, investing in power grid infrastructure, supporting long-term industrial power purchase agreements and ensuring effective implementation of the Carbon Border Adjustment Mechanism (CBAM).
VietnamSteel by Hoa Sen Group
