Beatriz Yordi Aguirre, a director at the European Commission's climate directorate, has called for calm in response to the record-high carbon prices, stating, "I think we need to keep calm with the €60 market." She emphasized the importance of distinguishing between short-term market conditions and longer-term trends. Concerns about rapidly rising carbon prices have been raised by countries like Poland and Spain. Polish state-owned electricity company PGE expressed the burden of compliance costs resulting from higher CO2 prices.
Yordi Aguirre acknowledged the influence of rising gas prices on the current market situation. She also highlighted that recent reforms to the EU Emissions Trading System (ETS) were aimed at stabilizing CO2 prices and encouraging companies to reduce emissions.
Some analysts argue that the EU carbon market is providing an appropriate price signal to drive decarbonization efforts. Additionally, they dismiss the notion of introducing a price ceiling, noting that it could impede the achievement of decarbonization targets. EU climate chief Frans Timmermans warned against intervening in the market in response to high prices, as he believed it would undermine the credibility of the ETS.
However, countries like Poland have expressed concerns that the proposed ETS reforms will result in a shortage of carbon allowances before 2030. PGE estimates that compliance costs for Poland will amount to €136 billion and doubts that the EU's Modernization Fund, which it estimates at €93 billion, can bridge the gap. The EU has proposed approximately doubling the fund as part of its planned ETS reform.
