ETS and/or ESR: What's on the cards for the building sector?
As announced in the European Green Deal, the European Commission is looking into amending the current Emission Trading System (ETS) and Effort Sharing Regulation (ESR). The main objective of the ETS revision is to align ETS legislation with the new 2030 ambition of reducing by 55% GHG emissions. Among the possible paths of a revision there is also the possible extension of ETS to new sectors, including buildings. For the time being, non-ETS scheme are submitted to the Effort Sharing Regulation (ESR), which establishes binding annual greenhouse gas emission targets for Member States on a national level. But what does the future hold for the building sector and at what cost?
As an association, we are committed to improve the sustainability of our built environment at the EU level, and likewise we acknowledge the importance of EU wide measures to reach the carbon neutrality objective. In our view, the possible extension of the ETS towards the buildings sector can indeed present several benefits to this end. Nevertheless, it needs to be highlighted that the trade-offs for the extension of the ETS to the building sector cannot be guaranteed. We also further question the need for a “double sentence” for our sector in the context of the ESR review: keeping current ESR sectoral scope in parallel to extending emissions trading to new ETS sectors would entail additional costs and efforts both from the national legislators and the sectors involved. Therefore, we should avoid having both mechanisms being applied to the same sector simultaneously.
On a more general note, we call the Commission to pay particular attention to the risk of redundancy and possible risks of overburdening the citizens and building owners as the future efforts foreseen for the building sector are tremendous. The targeted legislative actions announced in the Renovation Wave shall be reinforced in the coming years and will have a strong financial impact on the households across the EU. For these reasons, we advocate against adding an unnecessary layer of complexity to an already complex and multifaceted greening process in the building sector.