• 5% drop in 2024 emissions under the EU ETS brings total reduction to ~50% since 2005.
• Power sector led the decline, with a 12% cut in electricity emissions driven by a surge in solar and hydropower.
• Aviation and fertilizer emissions rose, showing uneven decarbonization across sectors.

The EU Emissions Trading System (ETS) continues to show strong results, with greenhouse gas emissions in covered sectors falling by 5% in 2024, according to a new report from the European Commission. This marks a total decline of approximately 50% since the system’s launch in 2005, putting the EU firmly on track to hit its 2030 target of a 62% cut.

“The observed trend confirms the effectiveness and efficiency of the EU’s cap and trade system as an important policy instrument for the decarbonisation of the European economy,” the Commission stated.

Power sector driving progress

The electricity generation sector remains the largest contributor to EU decarbonization. In 2024, emissions fell 12% year-over-year, due to a significant shift in the energy mix:

• Renewables rose by 8%
• Nuclear increased by 5%
• Gas and coal fell by 8% and 15%, respectively

Notably, solar power surged by 19%, while hydropower also grew. Wind power held steady despite weather-related challenges, and overall electricity production remained flat compared to 2023.

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Industry shows mixed results

Energy-intensive industries held relatively stable emissions in 2024, though performance varied:

• Fertilizer sector emissions rose 7%, aligning with a 6% increase in production
• Cement sector emissions dropped 5%, reflecting a 5% fall in output

Aviation rebounds

Aviation emissions grew 15%, driven partly by expanded ETS coverage to include non-domestic flights to and from EU outermost regions.

The ETS, which covers sectors such as oil refineries, steel, chemicals, and commercial aviation, is expected to generate €40 billion in revenues from 2020–2030, while continuing to tighten its cap and expand its scope.

With steady structural reforms and increased renewables uptake, the EU ETS is solidifying its role as a cornerstone of the bloc’s climate strategy.

Read the full report here.

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