Emissions covered by EU ETS down by 50% since 2005

Emissions from the sectors covered by the EU Emission Trading System (EU ETS) have dropped by 50% since 2005, with a 5% reduction in 2024 alone.

This puts the EU on track to achieve a 62% reduction in EU ETS emissions – which include power production, energy-intensive industries such as oil and gas, steel, iron, aluminium, cement and ceramics, as well as aviation and shipping – by 2030. 

“The observed trend confirms the effectiveness and efficiency of the EU’s cap and trade system as an important policy instrument for the decarbonisation of the European economy,” the European Commission said in a statement.

Power progress

The trend has so far been driven by the power sector, with emissions from electricity down 12% year on year in 2024, thanks to the rise in renewable energy production (up 8%) and nuclear (up 5%). 

According to the European Commission, solar power has been the main driver of the recent increase in renewable energy in the EU – with an “impressive” 19% rise last year – followed by hydropower. Meanwhile, wind production remained steady.

The increase in renewable capacity was coupled with a decrease in gas production (8%) and coal (15%). All in all, electricity production costs remained consistent in 2024, compared to 2023.

Read also: EU emissions down 8% – ‘Largest annual drop in decades’

Industrial emissions stagnate

While power emissions decreased significantly, those in high-emitting industries remained stable, with some sectors seeing an increase and others achieving a drop. 

Emissions in the fertiliser sector increased by 7%, for example, while emissions in the cement sector decreased by 5%. For the European Commission, these variations are mainly the result of changes in production volumes, with the fertiliser industry growing its production by 6% in 2024 while the cement sector saw a 5% drop in production.

Aviation emissions on the rise

Aviation emissions rose by 15% between 2023 and 2024 – a result of both the continuation of the post-COVID-19 recovery and the broadening of the EU ETS’ geographical coverage to include non-domestic flights to and from airports in the EU’s outermost regions (such as French Guiana, Guadeloupe, Martinique, Mayotte, the Azores and Canary Islands).

A recent report on the EU’s aviation sector found that progress has been made in terms of fuel efficiency and carbon intensity, but the industry is still awaiting key milestones, particularly around sustainable aviation fuel (SAF).