EU Commission proposes ETS overhaul and 2040 electrification goal

The European Commission presented its review of the EU Emissions Trading System (ETS), outlining a more stable framework for the market and proposing the Sustainable Maritime and Propulsion (SMAP) scheme. The plan aims to narrow the price gap between fossil and alternative fuels, channel ETS revenues into green‑fuel and technology projects, and keep the current geographical scope while adjusting rules after a global shipping climate agreement.

Shipping industry groups welcomed the emphasis on long‑term rules, noting that billions have already been invested in vessels ready for green fuels but that fuel supplies remain limited. They stressed that ETS funds should support both immediate emissions reductions and the infrastructure needed for future sustainable fuels.

In parallel, the Commission introduced a new electrification target: by 2040, 46% of the EU’s total energy consumption should be electricity, up from about 23% today. This adds to existing Green Deal goals on emissions reductions (55% by 2030, 90% by 2040, net‑zero by 2050), renewable share (42.5% in 2030) and energy‑efficiency cuts (11.7% below forecasts). Critics argue the expanded set of targets increases complexity and cost for decarbonisation efforts.