With Europe’s competitiveness set to dominate the informal EU leaders’ meeting on 12 February, pressure from energy-intensive industries is mounting for action on rising carbon prices and persistently high energy costs.

In a joint statement released this week, Europe’s energy-intensive industries—including steel, chemicals, and cement—called for the adoption of “emergency measures to protect the European economy from further carbon-related costs.”

The industry letter proposes suspending, from 2026 onward, further reductions in EU Emissions Trading System (ETS) benchmarks as well as the application of the cross-sectoral correction factor (CSCF). Industry representatives warn that, without such measures, energy-intensive sectors could face a loss of up to 34% of free allowances compared with the 2021–2025 period.

In addition, industry groups are calling for “concrete short-term initiatives” to immediately reduce total energy costs. “All available instruments should be mobilised to bring industrial total electricity costs in the EU closer to €50/MWh,” the document states.

According to Handelsblatt, citing senior EU officials, the European Commission is considering changes that would weaken its flagship climate policy. An article published on Wednesday reported that the Commission may extend the duration of free allowance allocations and delay the phase-out of auctions beyond current plans.

However, speaking to Reuters, Kurt Vandenberghe, Director-General of the Commission’s climate department, denied the claims. “We have never said this,” Vandenberghe said, adding that “we are looking at all the options” to address carbon leakage.

The European Commission is expected to conduct a comprehensive review of the EU Emissions Trading System by July 2026.