Ahead of today’s vote on the EU Emissions Trading System’s Market Stability Reserve, ECR Shadow Rapporteur Alexandr Vondra is calling on the European Parliament to reject the compromise adopted by the Environment Committee and support the European Commission’s original proposal to end the automatic invalidation of allowances held in the reserve.

Under the committee’s position, allowances above a threshold of 650 million would continue to be permanently removed from the market from 1 March 2027. The Commission instead proposes to stop invalidation, allowing the reserve to provide a larger buffer against future market imbalances, scarcity and price spikes.

Speaking in the debate on Monday, Vondra said:

“High energy prices are one of the biggest headaches facing Europe today. They hurt households, businesses and industry, and they are one of the reasons why we are falling behind competitors such as the United States and China.

“We need a stable and predictable carbon market. That means avoiding artificial scarcity of allowances and reducing the risk of sudden price spikes. On this occasion, the Commission understood the problem and came forward with a simple and sensible proposal to stop the invalidation of allowances in the Market Stability Reserve.

“Unfortunately, the compromise agreed in the Environment Committee moves away from that approach and preserves a mechanism that permanently removes allowances from the market. At a time when European industry is already under enormous pressure, we should not be creating additional risks of scarcity and higher costs.

“Parliament has the opportunity to correct this. I will urge colleagues to reject the committee compromise and stand behind the Commission proposal. It is the reasonable way forward if we are serious about stable prices, competitiveness and protecting Europe’s industrial base.”