On 23 September 2025, the European Parliament's Committee on the Environment, Climate and Food Safety (ENVI) held a debate on the extension of the EU Emissions Trading System to new economic sectors. ETS2, a separate system covering emissions from road transport and buildings. This is one of the most important climate extensions within the "Fit for 55" package, which will change the way energy, fuel, and logistics markets operate across Europe.
What is ETS2?
The new system will enter into force in 2027 and will operate independently of the existing EU ETS (which covers energy-intensive industries, the power sector, and aviation). Its goal is to gradually reduce emissions from two areas that account for a significant portion of Europe's carbon footprint: road transport and building heating. ETS2 will operate under the "cap and trade" principle: an emissions cap will be introduced, which will decrease over time, and fuel and energy suppliers will be required to purchase allowances proportionally to the emissions generated from their sales.
Unlike the current ETS, the system does not provide free allowances – all certificates will be auctioned. This means that the cost of emissions will be directly transferred to the market and may ultimately impact fuel and energy prices. A portion of the revenues from ETS2 will be allocated to the newly created Social Climate Fund, which will aim to mitigate the impact on low-income households and support investments in the energy transition.
Debate in the European Parliament
During the September debate, MEPs and European Commission representatives highlighted several key challenges. The most important is ensuring social justice – rising energy and fuel costs can particularly impact less affluent citizens. Therefore, it is crucial that support mechanisms within the Climate Fund operate effectively and reach those most in need.
The second element is the stability and transparency of the new market. ETS2 is intended to be a market-based mechanism, so it is essential to ensure price predictability and clear rules for trading allowances. Parliament also emphasized that excessively rapid cost increases could lead to public discontent and undermine support for the entire transition.
There was also discussion about the risk of "carbon leakage," or the relocation of operations to countries without similar regulations. In this context, ETS2 complements the CBAM mechanism – both tools aim to secure the competitiveness of European companies in the face of global competition.
Challenges for companies
For businesses, this means preparing for a new reality. Fuel and energy suppliers will need to not only acquire allowances but also implement emission monitoring and reporting systems, similar to the current ETS. This requires new competencies, processes, and IT tools.
The cost of purchasing allowances will become a crucial element of business calculations, influencing margins and pricing policies. Companies operating in sectors that heavily rely on road transport – from logistics to retail – should now analyze how rising fuel prices will impact their operating costs and competitiveness.
At the same time, ETS2 opens up new opportunities. Companies that invest more quickly in decarbonizing transport and buildings—for example, through electromobility, energy efficiency, or renewable energy sources—will gain a competitive advantage. The system also creates the potential for new sources of financing for the transition, as auction revenues are intended to support climate investments.
Co dalej?
ETS2 is not just another regulatory mechanism, but a key element of the broader European climate policy puzzle. Along with CBAM, EUDR, and the circular economy regulatory package, it forms the foundation for a new business model in the EU. For companies, this means that adapting to climate change requirements is no longer an option, but a necessity.
The coming months will be crucial, as the European Commission and Parliament must finalize technical details and prepare the market for the system's launch in 2027. It is therefore worth starting now to analyze costs, decarbonization strategies, and technological solutions that will meet the new requirements.
