Let's not fight the wrong battle!

In 2005, Europe took a visionary decision: to put a price on carbon. With the Emissions Trading System, it sent a clear signal to the market: polluting has a cost, innovating has a value.

How does it work? In the sectors currently covered, namely energy production, heavy and energy-intensive industries, aviation within the European Economic Area and maritime transport, those who invest in modernising and improving the efficiency of their systems can refinance themselves by selling rights to those who do not. This lightens the financial burden on those who are playing the decarbonisation game, shifting it instead to those whose behaviour is polluting.

From 2027, the building, road transport and small industrial installations sectors are expected to be integrated into the ETS system.

Twenty years later, voices are being raised to weaken, suspend or even abolish it. Italy cites the rise in electricity prices. The debate is drifting dangerously: protecting purchasing power is being pitted against preserving the carbon credit system. This is a false argument, since anything that encourages investment in efficiency will inevitably lower the cost of energy bills.

The ETS is not an ideological punishment. It is a market mechanism. It does not dictate how to produce; it corrects a distortion: emitting CO₂ is no longer free. Morally, the polluter pays. Economically, it is a signal for investment. Remove it, and you send the opposite message: polluting and wasting costs nothing.

Abolishing the ETS would be a strategic mistake, as Spanish Prime Minister Pedro Sanchez also points out. It would be like removing the compass as the industrial and geopolitical storm intensifies. The real question is not whether to preserve or weaken the system, but how to use its revenues intelligently. And ultimately, to make the ecological transition the driving force of the economy.

In today's global competition, ETS revenues must finance modernisation: electrification of processes, energy renovation of buildings, innovation in materials, storage, smart grids. In other words, transforming a constraint into a competitive advantage.

Wanting to lower electricity prices by weakening the ETS is treating the symptom while ignoring the cause. The sustainable solution is not cheaper energy because it is subsidised, but energy that is better used and therefore less wasted. Efficiency is the cheapest, cleanest and most sovereign source: every kilowatt hour saved is a kilowatt hour that does not need to pass through the Strait of Hormuz.

Energy sovereignty is not about subsidising imported fossil fuels, but about producing locally better with less. Used properly, the ETS can be the cornerstone of a system that reconciles climate and competitiveness, directing capital towards clean technologies and penalising obsolete models. Without this price signal, investment will stagnate and Europe will fall even further behind those who are investing heavily in cleantech elsewhere.

China, which has just published its fifteenth five-year plan, is strengthening its ambitions in the field of clean technologies. While its CO₂ emission reduction targets remain relatively vague, the country is firmly committed to the development of cleantech, illustrating the strategic importance it attaches to innovation and the deployment of these technologies.

Yes, vulnerable households must be protected – by using ETS revenues to finance targeted aid, energy renovation or heat pumps in order to reduce their bills in the long term.

Yes, we must support exposed industries – by accelerating their modernisation, not by artificially prolonging doomed models.

Weakening the ETS would mean giving in to short-term fears and sacrificing long-term consistency in an increasingly unstable world. 

Europe does not need less carbon signalling, but stability and credibility so that capital can flow, projects can reach final investment decisions and industry can develop. Only then can competitiveness and climate ambition be reconciled.

You don't turn off your headlights when you enter fog!

Also, published by Investir (Les Echos), EFE Verde, and La Reppublica  Green&Blue