European Union Unveils Reforms to its Carbon Market Amid Climate Ambitions and Energy Costs

The European Union has unveiled reforms to its two-decade-old Emissions Trading System (ETS), its flagship climate change policy. The overhaul aims to shore up industry while addressing high energy costs and aligning with the EU's 2040 goal to cut net emissions by 90%. Proposed changes include greater flexibility for industry, potentially phasing out free allowances more slowly, and pushing member states to channel ETS revenues into decarbonization.