Greens Block Merz’s EU CO2 Trading Revamp, Warn of Market Weakening

Greens Block Merz's EU CO2 Trading Revamp, Warn of Market Weakening

Franziska Brantner, co‑chair of the Green Party, rejected Chancellor Friedrich Merz (CDU) saying that the proposal to overhaul the EU’s existing CO₂‑emissions trading system-and postponing the next steps if the economy warrants-would be a mistake. In an interview on RTL’s “Frühstart” and ntv she said the goal must be to preserve and renew prosperity without destroying the planet. “Germany should develop the technologies that will create jobs and profits, and not hand that over to China” she added.

Brantner underlined the need for a stable, predictable market that rewards climate action. “It is a market mechanism that Mr Merz has always advocated” she said. “Now the focus must be on boosting European competitiveness, speeding processes, simplifying them, and protecting our industries from unfair competition”.

The Greens suggested that the government could cut the electricity tax, stabilize indirect labour costs and invest in innovation. “Focusing on the past and saying we can’t pursue sustainable prosperity is absurd” she said. “The Chinese make a lot of money from this; we should be able to do so too”.

The EU operates two CO₂‑emissions trading schemes, which are the most important climate‑protection tools. The number of certificates in the energy and industrial ETS (EU‑ETS‑1) is reduced by 4.4 % per year, so that in 2039 the market will be fully phased out. A portion of the certificates is still allocated free of charge to companies, but this free allocation will be sharply curtailed starting this year.

In Germany the revenues from the CO₂‑trading system are directed into the Climate and Transformation Fund. The fund finances projects such as the expansion of renewable energy, promotion of electric mobility, energy‑efficient building renovations, hydrogen initiatives and the transition to climate‑friendly industrial processes.