ETS Market Stability Reserve: EPP Group remains united while Left-wing obstructs

The European Parliament's Industry and Energy Committee has rejected a proposal to substantially advance the introduction of the so-called Market Stability Reserve (MSR) as part of the EU's Emissions Trading Scheme. A Left and Green alliance had insisted on establishing the MSR already in 2017 - 4 years earlier than proposed by the European Commission - despite tangible competitiveness concerns of manufacturing industries.

"The current economic situation in Europe is rather challenging in particular for industry. It is therefore very important to avoid a situation where on the one hand we advocate reindustrialisation via the 20% of EU GDP which comes from the manufacturing industry as a means to get out of the crisis, and on the other hand proposing policies which could lead to the opposite. European industries need a stable and long-term legislative framework that effectively combines EU climate ambition with EU industrial competitiveness", said Antonio Tajani MEP.

"For this reason, the EPP Group had proposed important improvements to the ETS proposal in order to have safeguards for industry. Strong carbon leakage provisions and adequate thresholds for the activation of MSR will give the industry the possibility to adapt to the new system without additional costs. During today's vote, our Group won on all these points, demonstrating that it is possible to strike a good balance between industry and climate policies", explained Tajani. However, a majority of Socialists, Liberals, Greens and Eurosceptics rejected the Market Stability Reserve in the final vote.

"As for the starting date, our Group has repeatedly tried to find a compromise with the S&D-led coalition by proposing, inter alia, 2019 as a possible solution. After the refusal of the S&D Shadow Rapporteur to compromise on the date, our Group has decided to keep 2021 as the starting date, as in the original Commission proposal, which was accepted during today's vote. Due to their defeat, the S&D decided to vote against the MSR in the final vote, finding unusual allies in UKIP Members. Thanks to these unfortunate manoeuvres of the S&D Group, we have unfortunately lost the possibility of submitting some important improvements to the text for the upcoming negotiations in the Environment Committee, such as the introduction of a provision on carbon leakage", said Tajani. "Now the Environment Committee will only have the Commission proposal as a reference text which, paradoxically for the S&D, entails 2021 as the starting date which is, in turn, the initial position of our Group. We sincerely hope that the S&D Group will learn the lesson from today that there will be no reliable majority in this house against the EPP Group."