Czech Republic calls on EU to review carbon trading schemes

The European Union should review its carbon trading schemes to lower energy prices. This was called for by Czech Prime Minister Andrej Babiš in a letter to EU institutions and leaders of the other 26 countries in the bloc, published on February 2. This was reported by Reuters.

Babiš believes that the EU should limit the cost of emission allowances under its ETS and postpone the implementation of its second phase.

At a press conference, the Czech Prime Minister said he would lobby for support on this issue among other EU leaders, including France and Italy, ahead of the bloc’s informal summit on February 12. According to him, prices for allowances in previous years were forecast to be much lower than the current level, which puts a heavy burden on European industry.

In addition, according to Czech Radio, Babiš stressed the need for a single pan-European goal — reducing carbon emissions. However, in his opinion, setting additional partial goals limits the ability of member states to make their own decisions in the energy sector and may be less effective and more financially demanding than individual approaches.

The official also called for postponing the introduction of the emissions trading system for buildings and transport, known as ETS2, until at least 2030. The bloc had previously agreed to postpone its launch from 2027 to 2028.

Some countries, including Poland, have long argued that carbon prices in the EU are too high and have called on Brussels to intervene to curb the rise, which they believe is driven by financial speculation rather than genuine demand from greenhouse gas-emitting industries. Other EU countries consider high prices important for achieving climate goals, as they encourage investment in low-carbon technologies and the transition to cleaner fuels.

At the end of last year, carbon market analysts expected European carbon prices to rise in 2026. Montel experts predicted that the average EUA price would be €92.02/t, which is about 24% higher than in 2025. ING expects the average price of emission allowances in the EU to reach €83/t this year, compared to an average of almost €75/t in 2025.

Climate Market Now believes that in Q1, the market will aim to reach a historic high for the benchmark contract of €101.25/t. BBVA’s baseline scenario for 2026 assumes that carbon allowances will trade in the range of €80-100/t.

According to GMK Center’s forecast, by 2030, the average price for CO₂ emissions in the European emissions trading system could reach €126/t. This figure is the consensus among estimates from leading analytical institutions, including BloombergNEF, ABN Amro, Refinitiv, ICIS, S&P Global, Aurora Energy Research, and the Potsdam Institute for Climate Impact Research.