On Monday, the European Commission published its proposal for the revised EU ETS benchmark values for the 2026–2030 period, marking an important step in defining the volume of free allowances that will continue to be allocated to European industry under the EU Emissions Trading System.

The 54 product-specific benchmark values are revised by the European Commission as part of its five-year review cycle, with the latest update covering the 2026–2030 period. The revision is intended to keep the system aligned with market developments and ensure the effective functioning of the EU ETS.

According to the new proposal, “industry will, on average, continue to receive free allocation covering around 75% of its emissions,” with the European Commission stating that the measure seeks to address “industry concerns by making full use of the legal flexibilities available.”

Free allocation for each installation will continue to be based on the performance of the top 10% most efficient installations during the 2021–2022 period. For 14 product benchmarks that previously covered indirect emissions, the Commission now proposes to continue taking indirect emissions into account, resulting in higher benchmark values and “a financial impact of around €4 billion for the 2026–2030 period.”

“The benchmark proposal offers long-awaited clarity for industrial emitters on the volume of free allowances they will receive under the EU ETS,” according to Quantum Commodity Intelligence.

Following a four-week public consultation and review by EU Member States in the Climate Change Committee, the Commission is expected to adopt the benchmarks by the end of June, enabling the allocation of free allowances to industry shortly thereafter.