The update below was edited on 3 May 2023 to clarify plans to auctions allowances for REPowerEU actions in 2023.
In December 2022, the European Parliament and the Council reached an agreement on financing additional actions under REPowerEU. Of the additional EUR 20 billion in grants, EUR 8 billion will be financed through anticipating the Member States’ auctioning of emission allowances and EUR 12 billion from the resources of the Innovation Fund. These allowances shall, in principle, be auctioned in equal volumes by August 2026. The Innovation Fund will be partly replenished through the auctioning of 27 million allowances from the Market Stability Reserve.
The amendment of the EU Emissions Trading System Directive (Directive 2003/87/EC) related to RePowerEU entered into force on 1 March 2023. To ensure swift auctioning of the allowances, the Commission has already started work on implementing the necessary changes to the auction process. This includes relevant changes to the contract for the common auction platform in consultation with Member States and the revision of the auction tables through a corresponding Commission Decision.
The Commission expects this process to be completed by the summer. The auctioning for the purpose of REPowerEU is therefore tentatively envisaged to start in July 2023.
40 million Innovation Fund allowances will be auctioned in 2023. Some revenues from the auctioning of these 40 million allowances will be used to finance RePowerEU actions.
In addition, from July 2023, 16.5 million allowances that would otherwise have been auctioned by Member States in 2027-2030 will be auctioned for the purposes of RePowerEU.
The annual volumes of Innovation Fund allowances to be auctioned for 2024 and beyond will be determined following an amendment of the ETS Auctioning Regulation that the Commission is currently preparing. The adoption of this amendment is scheduled for this October 2023, well in time for the auctioning of Innovation Fund allowances in 2024.
Further information, including on the revised auction volumes and the corresponding auction calendars will be published well in advance of the start of the auctions. The amendment of the Auctioning Regulation with additional elements necessary for REPowerEU, including for frontloading the Innovation Fund, will follow.
- Publication date
- 27 March 2023 (Last updated on: 3 May 2023)
- Directorate-General for Climate Action