Commerzbank’s Norman Liebke has highlighted that the upcoming reform of the EU Emissions Trading System (EU ETS I) introduces new benchmark calculations, which could significantly increase costs for European aluminium recyclers and refineries [1]. The reform includes a new method for calculating benchmark values, crucial for the free allocation of emissions allowances. These benchmark values are set to decrease by 34% for the 2026–2030 period compared to the 2021–2025 values, meaning companies will need to purchase substantially more allowances [1].
Industry group European Aluminium warns that this change could have a massive impact on profitability, as the higher costs cannot simply be passed on to customers due to globally set aluminium prices [1]. The association cautions that the reform threatens to undermine the competitiveness of aluminium recycling in Europe [1].
The EU ETS reform is intended to ease the burden on companies and provide more time for decarbonization, including changes to the market stability reserve and plans for a decarbonization fund. However, the new benchmark calculation method is expected to pressure margins for recyclers and refineries, raising concerns about the sector's future viability in Europe [1].
CONCLUSION
The EU ETS reform is poised to significantly increase costs for European aluminium recyclers and refineries, raising concerns about profitability and competitiveness. Industry voices warn that the inability to pass on these costs in a globally priced market could undermine aluminium recycling in Europe, marking a high-impact development for the sector.