The Polish delegation of the European Conservatives and Reformists Group (ECR) opposes the direction of the changes proposed in the report by the Committee on the Environment, Climate, and Food Safety (ENVI) regarding the reform of the Market Stability Reserve (MSR) for the ETS2 system. According to Anna Zalewska, the ECR’s shadow rapporteur, the compromise adopted by the committee weakens price stabilization mechanisms and could lead to higher heating and transportation costs, particularly in countries such as Poland.
As Zalewska emphasizes, the European Commission’s original proposal aimed to increase the flexibility of the ETS2 system and reduce the risk of spikes in allowance prices, including through the possibility of a more gradual release of allowances from the MSR reserve and intervention mechanisms —including the release of 20 million allowances once the 45-euro threshold is exceeded, with the option to release an additional 20 million during the system’s first years of operation (through 2029). The Commission also proposed moving away from the automatic cancellation of allowances starting in 2031, in order to maintain the MSR as a viable stabilization buffer.
In the assessment of the Polish ECR delegation, the compromise adopted in the ENVI Committee—with the support of the EPP, S&D, Renew, and the Greens—moves in the opposite direction and weakens this mechanism by partially reinstating the rule of allowance cancellation. According to the report, starting in 2034, half of the allowances in the reserve would be canceled, and starting in 2036, all unused allowances would be permanently removed from the system.
As Zalewska points out, this limits the MRR’s ability to respond to price spikes and, in practice, reduces the security of the ETS2 system, which could translate into higher energy costs for citizens.
The Polish ECR delegation also emphasizes that the MSR should serve as a market stabilizer, not as a mechanism for permanently reducing the supply of allowances, as this leads to higher allowance prices, and consequently to higher heating and transportation costs, particularly for lower-income households.
The ECR also points out that the EPP Group, which led the negotiations in the ENVI Committee, accepted solutions that weaken the Commission’s original proposal, which represents a shift away from a price-stabilization approach in favor of more ambitious emissions reductions at the expense of the system’s predictability.
Consequently, the Polish ECR delegation voted against the report at the ENVI Committee stage and announced that it would table amendments during the European Parliament’s plenary session. First and foremost, the amendments will aim to remove from the ETS Directive the provisions extending the system to transportation and buildings (ETS2). If this proposal does not receive support, further amendments will be proposed to strengthen the flexibility of the MSR, remove provisions regarding the cancellation of allowances, and increase protection for citizens against cost increases resulting from the operation of ETS2.
The delegation emphasizes that the climate transition should be realistic, predictable, and tailored to the economic capabilities of Member States, and that the ETS2 system must not lead to an uncontrolled increase in the cost of living.
