- Italy and the Czech Republic plan to propose changes to EU carbon and energy rules at the October leaders’ summit.
- The governments want more flexibility in the EU carbon market and a delay to ETS2, which covers road transport and buildings.
- Rome and Prague are also seeking a temporary suspension of some methane-related requirements amid concerns about gas supply and costs.
Italy and the Czech Republic are preparing a joint push to reshape EU energy policy, with the EU ETS2 at the center of proposals aimed at containing energy costs and easing pressure on businesses and consumers.
The initiative by prime ministers Giorgia Meloni and Andrej Babiš is expected to be presented at an EU leaders’ summit on Oct. 15-16. Their governments are seeking changes to carbon market rules, methane requirements and the timetable for the bloc’s next emissions trading system.
Carbon market comes under pressure
Rome and Prague want the EU to make greater use of its Market Stability Reserve to limit cost pressures linked to carbon allowances. The reserve was created to manage an excess supply of permits and stabilize the EU’s emissions market. The European Commission says about 190.5 million allowances are scheduled to enter the reserve between September 2026 and August 2027.
The two governments are also calling for greater flexibility in the distribution of carbon allowances and measures that could reduce the impact of carbon costs on electricity generation. A broader Commission proposal this year has already sought changes to the EU carbon market to support industrial competitiveness while maintaining the bloc’s climate targets.
Push to delay ETS2
Italy and the Czech Republic want to postpone the rollout of ETS2, the system that extends carbon pricing to buildings, road transport and other sectors. EU institutions have already adjusted the timetable, with the system’s operations now scheduled for 2028, while auctions of ETS2 allowances are due to begin in 2027.
Supporters of the system say carbon pricing can accelerate investment in cleaner transport and heating. The EU has also established an €86.7 billion ($98 billion) Social Climate Fund for 2026-2032 to help address the impact of carbon pricing on vulnerable households.
Methane rules add to supply concerns
The governments are also seeking a temporary suspension of methane-related requirements affecting imported oil, gas and coal. Under current EU rules, importers face additional monitoring, reporting and verification requirements from Jan. 1, 2027.
The debate comes as European governments confront higher energy costs and concerns over the reliability of global fuel supplies. The European Commission has said the methane framework is intended to preserve security of supply while reducing emissions, while several governments have pushed for more time to implement the rules.
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