EC Climate Chief Tells Politicians to Stay Out of EU Carbon Pricing
The Commission's non-interference call arrives as its own supply-side reform proposals have driven analysts to cut ICE EUA Dec-rolling forecasts through 2027.
The European Commission's climate chief told European politicians on Thursday (2026-09-24) to stop trying to influence EU carbon prices, arguing that industry needs a stable carbon signal to commit to decarbonisation investment. Montel reported the remarks.6
The Commission's approach has not always reflected that principle. In April (2026-04-01), it proposed amending the ETS cap-and-trade framework to boost the supply of pollution permits and shield energy-intensive industries from high carbon costs, according to Politico. The proposal was framed as emergency relief.4
Markets tracked the legislative trajectory closely. The ICE EUA Dec-rolling contract fell 3% in Thursday (2026-07-16) afternoon trading, dropping below EUR 80/t, as traders positioned ahead of the Commission's full ETS reform package due the following day, Montel reported.3
Analysts revised their forecasts down from there. By late July (2026-07-31), Reuters reported that banks and research houses had cut ICE EUA Dec-rolling price forecasts for 2026 and 2027, directly attributing the reductions to the Commission's reform proposals and their expected effect on future allowance supply.5
ICE EUA Dec-rolling stood at €85.70/tCO2 on Thursday (2026-09-24). The recovery from July's lows is visible. But the market's full positioning sits on the bearish side, with no bullish signal weight in current consensus data.6
Member state pressure has compounded the institutional uncertainty. Italy urged the EU in May (2026-05-21) to scrap a planned revision to ETS benchmarks — the mechanism that sets free allowance allocations to heavy industry — warning the change would raise compliance costs and erode European industrial competitiveness, Montel reported.1
The argument from industrial-government lobbies has been consistent since prices began climbing: high carbon costs are a global competitiveness disadvantage. The Commission's climate chief is pushing back directly, holding that undercutting the market price mechanism creates a worse problem. Industries underwriting decade-long capital projects cannot plan against a carbon price subject to political override.6
The supply-side interventions since April are, in any case, already embedded in the market. Analyst forecasts built after the July reform proposals run below current spot levels for 2026 and 2027. Those forecasts reflect actual Commission decisions and will not reset on the basis of a statement from the climate chief.4,5,3
One supply variable with a defined end point is the REPowerEU auction programme. EEX's chief executive confirmed the exchange will halt allowance auctions under that programme once the €20 billion fundraising target is reached. That endpoint removes one discrete source of additional supply but leaves the benchmark revision timeline unresolved.2
Italy's formal opposition to the benchmark revision remains on the table. If member states succeed in delaying or diluting it, free allowance allocations to heavy industry would remain higher than the Commission planned — effectively softening the cap without any explicit endorsement of a price target. That outcome is precisely what the climate chief spoke against on Thursday (2026-09-24), and the vote is still ahead.1,6