Poland has assembled a 10-country coalition to press Brussels to slow the tightening of the bloc’s emissions trading system (ETS) and reconsider a carbon market for buildings and road transport, the country’s climate minister said on July 16.

The initiative is backed by Italy, Bulgaria, Cyprus, the Czech Republic, Estonia, Greece, Hungary, Romania and Slovakia. Together with Poland, they can form a blocking minority that could halt changes unless their demands are met.

“We are fighting to repair the ETS and secure a fair energy transition for Poland,” Climate and Environment Minister Paulina Hennig-Kloska told PAP, the Polish state-run news agency. 

Launched in 2005, the ETS requires power plants, factories, airlines and shipping companies to surrender a permit for each tonne of emissions. It covers 40% of EU emissions and has cut power and industry emissions by about 47% since 2005.

The planned expansion of the system, known as the ETS2, aims at expanding it to put a carbon price on fuels used in buildings and road transport from 2028, a plan that meets objections from Poland and other countries.

The coalition assembled by Warsaw says households should not face new climate-related costs in the current economic and geopolitical environment.

The group wants a “realistic path” for cutting emissions and had sent its proposals to the European Commission, Hennig-Kloska said.

The group wants a slower annual reduction in carbon dioxide emissions allowances, so permits remain available closer to 2050 rather than being exhausted around 2039. Warsaw has argued for a reduction rate of just over 2%, compared with 4.4% planned from 2028.

It also wants more free allowances for energy-intensive industry, revised allocation benchmarks, an extension of the Modernisation Fund beyond 2030 and predictable carbon prices. Funding rules should reflect energy mixes and income levels.

The Commission is due to propose an ETS overhaul on July 17. 

Draft plans would slow the annual decline in the emissions cap from 2031 and extend free industrial allowances until 2037, while linking part of them to companies completing decarbonisation investments.

Poland and Italy oppose conditions on free permits, while countries like Germany and Sweden support ETS2 as necessary to encourage cleaner heating and transport.