The European Commission is set to review the European Emissions Trading System (EU ETS), a hallmark policy to reduce emissions in heavy industry and move towards EU climate targets. The Commission proposal is set to come out on 15 July.

The review opens the legislative file, allowing the Commission to propose changes before the revised text moves to Parliament and Council for negotiation. This creates a window to shape the outcome—one that powerful actors are using to push for weaker rules. Several member states, particularly Italy and Poland, alongside major industry groups are lobbying to extend free allowances, effectively undermining the core principle of the EU ETS. The latest attack by steel giants ArcelorMittal, ThyssenKrupp and Voestalpine and chemicals giant BASF marks one of industry’s most direct calls yet for the EU to retreat on climate action.

These loud voices get vast media and political attention, while voices demanding climate action and industrial renewal are less amplified. The results of the YouGov poll (2) show that a broad majority of European (1) citizens across France, Germany, Italy, the Netherlands, Spain and Poland are in support of the core principles of the EU ETS.

European citizens expect a carbon market that maintains incentives to decarbonise, governments to invest carbon revenues in decarbonisation and where free allowances continue, to come attached to clear conditions.

Key findings

• A majority of 59% of European citizens support measures requiring heavy industry to pay for its CO₂ emissions; only 23% are against. Support extends across political divides, reaching well beyond the traditional green electorate.
• An overwhelming 72% believe that companies emitting the most—or those failing to reduce their emissions—should pay more than others. Only 9% favour all companies paying the same amount, while just 8% believe companies should not be required to pay at all.
• One in two (50%) favour investing carbon revenues in industrial decarbonisation, rather than extending free allowances; only 18% support continued free allocation.
• A majority of 62% believes that, where companies are exempted from paying for their CO₂ emissions, they should be required to reinvest the value of those exemptions in reducing future emissions.
• Similarly, 63% of European citizens believe that companies benefiting from exemptions from carbon pricing should support a just industrial transition by investing in workforce reskilling, providing staff training and guaranteeing high-quality working conditions. 
• One in two (50%) believes that companies benefiting from exemptions should involve local communities in decisions about industrial transformation and its impacts.