Subject: Emissions Trading System for buildings
Assuming that the Emissions Trading System (ETS) for buildings, as proposed in the Fit for 55 package, will be fully implemented:
1. What will the additional cost for heating a square metre be in 2030?
2. What will the total cost of investment needed for the application of the ETS for buildings for both suppliers companies and consumers be in 2030?
Answer given by Executive Vice-President Timmermans on behalf of the European Commission (3 February 2022)
Together with transport, buildings are, alongside industry, the main energy users and source of emissions. To achieve climate neutrality by 2050, cost-efficient tools are needed to help us to renovate buildings to make them energy‐ and resource-efficient.
Estimating the additional cost from the introduction of the new emissions trading system for heating per square meter is not feasible as heating use strongly depends on geographic location, how well insulated buildings are and other factors.
The consumer price for heating will also depend on the fossil fuel prices on global markets and on the national fuel or carbon taxation. The best way to reduce these costs are to support and encourage energy saving investments.
Overall, the cost of overall fuel consumption could be reduced by up to 0.12 percentage points on average of household income if appropriate economically efficient investment take place to reduce consumption and emissions.
Considering, however, that implementing the EU 2030 climate ambition in the buildings sector should be socially just and fair, the Commission’s proposal contains measures, notably the Social Climate Fund, to alleviate the impact on the most vulnerable households and microenterprises and to support investments to reduce overall heating costs.
The Emissions Trading System (ETS) Impact Assessment (1) provides information on the level of investment for residential building renovation, which is estimated between 0.71 and 1.43 percentage points of household consumption (Table 20).
It also reflects on the administrative costs for the fuel suppliers, which is in general moderate due to the possibility to use the taxation infrastructure for excise duties. When this is not possible, e.g. for coal, an illustrative case estimates a cost for suppliers between EUR 6 085 and EUR 8 590 for one-off costs, and between EUR 4 900 and 6 350 for recurring costs.
There is no administrative costs for households. The latter will not be directly subject to the new system, but indirectly face higher costs for fossil fuels for heating to the extent that the fuel suppliers pass the costs for ETS allowances on to the consumer.
⋅1∙ https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A52021SC0601 | | ( | | )