The EU ETS applies in all EU Member States, the European Free Trade Association countries (Iceland, Liechtenstein and Norway) as well as Northern Ireland for electricity generation (under the Protocol of Ireland and Northern Ireland). It covers greenhouse gas emissions from around 10,000 installations in the energy sector and manufacturing industry as well as aircraft operators flying within the EU and departing to Switzerland and the United Kingdom. From 2024, the EU ETS also covers emissions from maritime transport.
Sectors & gases
The EU ETS covers the following greenhouse gases from specific activities, focusing on emissions that can be measured, reported and verified with a high level of accuracy:
- carbon dioxide (CO2) from
- electricity and heat generation
- energy-intensive industry sectors, including oil refineries, steel works, and production of iron, aluminium, metals, cement, lime, glass, ceramics, pulp, paper, cardboard, acids and bulk organic chemicals
- aviation within the European Economic Area and departing flights to Switzerland and the United Kingdom
- maritime transport, specifically 50% of emissions from voyages starting or ending outside of the EU and 100% of emissions from voyages between two EU ports and when ships are within EU ports.
- nitrous oxide (N2O) from production of nitric, adipic and glyoxylic acids and glyoxal
- perfluorocarbons (PFCs) from the production of aluminium.
Participation in the EU ETS is mandatory for companies in these sectors, but:
- in some sectors, only operators above a certain size are included
- certain small installations may be excluded if governments put in alternative measures to cut their emissions
From 2024, installations for the incineration of municipal waste above a certain threshold are also required to monitor and report their emissions in the EU ETS.