The Czech Republic intends to support Italy’s proposal at the European Council to suspend the application of the EU ETS 1 emissions trading system, which applies to the energy sector, heavy industry and air transport, Prime Minister Andrej Babis (ANO) told journalists after a government meeting yesterday.
Babis also said he intended to propose a price cap and exempt energy-intensive sectors from the system. The next European Council meeting will take place in Brussels on 19-20 March.
“Historically, the system had its justification, but it has turned into a money-making scheme even for those who are not required to pay for emissions,” said Babis.
He added that the Czech Republic would fight alongside other countries to push through what he saw as the only quick way to help European industry, especially given the current impact of the crisis in the Middle East.
The opposition Civic Democratic Party (ODS) supports the government’s approach.
“Thanks to previous policies of our [ODS-led] government, we have managed to open the door to a number of our partners in Europe, including Italy, so that we can strengthen our joint efforts to mitigate the negative impact of this regulation on energy prices. This is in our common interest,” ODS leader Martin Kupka told reporters.
Deputy Prime Minister and Minister of Industry and Trade Karel Havlicek (ANO) stated yesterday in Brussels that the Czech Republic was working to align with influential countries such as Germany and Italy regarding changes to the emission allowance trading system, and was succeeding. He said there was a chance that the EU ETS system would change.
According to the latest draft conclusions from Thursday’s summit, the presidents and prime ministers of EU member states will call on the European Commission during the meeting to submit a proposal for reforming the EU ETS by this July. The Commission previously stated that it planned to propose a reform of the system in the third quarter of this year, but did not mention a specific date.
Babis recently described the current system as an “absolute disaster,” claiming that the Czech Republic had lost nearly CZK 160 billion because of it. The Czech position calling for a change to EU ETS 1 is supported by Italy, Germany, Austria, Slovakia, Poland, and Hungary.
The price of emission allowances in the EU ETS 1 system is currently hovering around 70 euros per tonne of carbon dioxide emissions. In recent weeks, the price has ranged from roughly 69 to 75 euros per tonne. By comparison, the price in 2021 and 2022 ranged from 80 to 100 euros per tonne, and in 2024 and 2025 it was in the range of 60 to 90 euros per tonne.
The Czech government has also long criticised the expansion of the emission trading system to road transport and heating (EU ETS 2). This system is scheduled to go into effect in 2028 following a one-year delay.
According to Babis, other topics at the EU summit will include Ukraine, the Middle East, competitiveness and the internal market, the future multiannual financial framework after 2027, European security and defence, and migration.
