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Climate Action
News article15 May 2023Directorate-General for Climate Action1 min read

ETS Market Stability Reserve to reduce auction volume by over 272 million allowances between September 2023 and August 2024


The European Commission published today the Communication on the total number of allowances in circulation (TNAC) in 2022 on the European carbon market. It amounts to 1 134 794 738 allowances.

The TNAC indicator plays an important role in the functioning of the Market Stability Reserve (MSR) of the EU Emissions Trading System (ETS). It determines whether allowances are withdrawn to or released from the MSR. 

Under Decision 2015/1814 (MSR Decision), 24% of the TNAC is placed in the MSR if it exceeds the threshold of 833 million. This is done by decreasing the volume of allowances that Member States auction. If the TNAC falls below the threshold of 400 million, a portion of allowances from the MSR is released for auction.

In line with Decision 2015/1814 and based on the TNAC indicator published today, a total of 272 350 737 allowances will be placed in the MSR over a 12-month period, from 1 September 2023 to 31 August 2024.

Under Article 1(5a) of Decision 2015/1814, from 2023 onwards, any allowances held in the MSR above the previous year's auction volume are no longer valid. Today’s Communication indicates that 2 515 135 787 allowances in the MSR became invalid on 1 January 2023.

The next year’s Communication on the TNAC will take into account important developments.

  • Firstly, the amendments of Decision 2015/1814 as part of the ‘Fit for 55’ legislative package to deliver the European Green Deal, which will apply from 2024.
  • Secondly, Regulation (EU) 2023/435 (REPowerEU Regulation) adopted in February 2023, which constitutes part of the EU’s response to the energy crisis. Among other measures, it amends Directive 2003/87/EC (ETS Directive) to derogate from Article 1(5a) of Decision 2015/1814 by using 27 million unallocated allowances in the MSR for the Innovation Fund.

The next time the TNAC indicator is published will be by 1 June 2024.

Previous Communications on the total number of allowances in circulation - MSR indicator


Publication date
15 May 2023
Directorate-General for Climate Action