(1)

The Paris Agreement, adopted in December 2015 under the United Nations Framework Convention on Climate Change (UNFCCC), entered into force in November 2016 (‘the Paris Agreement’). Its Parties have agreed to hold the increase in the global average temperature well below 2 oC above pre-industrial levels and to pursue efforts to limit the temperature increase to 1,5  oC above pre-industrial levels.

(1)

The Paris Agreement, adopted in December 2015 under the United Nations Framework Convention on Climate Change (UNFCCC), entered into force in November 2016 (‘the Paris Agreement’). Its Parties have agreed to hold the increase in the global average temperature well below 2 oC above pre-industrial levels and to pursue efforts to limit the temperature increase to 1,5  oC above pre-industrial levels , while being guided by, inter alia, the principles of equity and of common but differentiated responsibilities and respective capabilities . By adopting the Glasgow Climate Pact in November 2021, the Parties to the Paris Agreement recognised that keeping the increase in the global average temperature to 1,5  oC would significantly reduce the risks and impacts of climate change, and committed to strengthen their 2030 targets by the end of 2022.

(1a)

The need for action to reduce emissions is becoming increasingly urgent, as stated by the Intergovernmental Panel on Climate Change (IPCC) in its latest reports of 7 August 2021 entitled ‘Climate change 2021: The Physical Science Basis’ and of 28 February 2022 entitled ‘Climate Change 2022: Impacts, Adaptation and Vulnerability’. The IPCC stated, with a very high level of confidence, that climate change is a threat to human well-being and planetary health and that any further delay in concerted anticipatory global action on adaptation and mitigation will miss a brief and rapidly closing window of opportunity to secure a liveable and sustainable future for all. The IPCC provides new estimates of the chances of crossing the global warming level of 1,5  oC in the coming decades, and finds that unless there are immediate, rapid and large-scale reductions in greenhouse gas emissions, limiting global warming to close to 1,5  oC or even 2 oC will be beyond reach. The Union should therefore address that urgency by stepping up its efforts and establishing itself as an international leader in the fight against climate change.

(3)

The European Green Deal (31) combines a comprehensive set of mutually reinforcing measures and initiatives aimed at achieving climate neutrality in the Union by 2050, and sets out a new growth strategy that aims to transform the Union into a fair and prosperous society, with a modern, resource-efficient and competitive economy , where economic growth is decoupled from resource use . It also aims to protect, conserve and enhance the Union's natural capital, and protect the health and well-being of citizens from environment-related risks and impacts. At the same time, this transition affects women and men differently and has a particular impact on some disadvantaged groups, such as older people, persons with disabilities and persons with a minority racial or ethnic background. It must therefore be ensured that the transition is just and inclusive, leaving no one behind.

(3)

The European Green Deal (31) provides a starting point for the achievement of the Union’s climate-neutrality objective by 2050 at the latest and the aim to achieve negative emissions thereafter laid down in Article 2(1) of Regulation (EU) 2021/1119 of the European Parliament and of the Council  (31a) . It combines a comprehensive set of mutually reinforcing measures and initiatives aimed at achieving climate neutrality in the Union by 2050 at the latest , and sets out a new growth strategy that aims to transform the Union into a fair and prosperous society, with a modern, resource-efficient and competitive economy. It also aims to protect, conserve and enhance the Union's natural capital, and protect the health and well-being of citizens from environment-related risks and impacts. At the same time, this transition affects all genders differently and has a particular impact on some disadvantaged groups, such as older people, persons with disabilities, persons suffering from energy or transport poverty , and persons with a minority racial or ethnic background. The transition also affects Member States and regions differently. It must therefore be ensured that the transition is just and inclusive, leaving no one behind.

(3a)

To be socially acceptable the climate ambition set out in this Regulation should be matched by an equivalent social ambition. The increased level of ambition implies substantial changes in the affected sectors which might have social and labour impacts. The revised emission reduction targets need to be accompanied by sufficient financial and policy measures to guarantee that those targets can be met in a socially fair way. The measures can include, inter alia, carrying out employment impact assessments which evaluate the impact on jobs and working conditions both at national and regional levels as well as allocating national and Union resources to fund social adaptation measures and quality job-creation, gender equality, life-long learning, vocational training and social protection and to ensure effective collective bargaining. It is also important that there is timely consultation and effective involvement of national social partners in the sectors covered by Article 2 of this Regulation with regard to the development and implementation of national measures implementing this Regulation.

(3b)

The transition to a Union economy compatible with target of climate neutrality by 2050 at the latest could furthermore have a particular impact on certain economic sectors, especially vulnerable micro, small and medium enterprises in those sectors. When implementing this Regulation, it is important that Member States create an enabling environment for those enterprises to transition to practices that entail fewer and gradually no greenhouse gas emissions.

(3c)

The United Nations Environment Programme and the OECD Global Forum on Environment have concluded that environmental changes have gender-specific impact. Gender-differentiated roles also result in differentiated vulnerabilities for all genders in relation to the effects of climate change, and climate change impacts exacerbate gender inequalities.

(4)

In Regulation (EU) 2021/1119 of the European Parliament and of the Council (32) (‘European Climate Law’), the Union has enshrined into legislation the target of economy-wide climate neutrality by 2050. That Regulation also establishes a binding Union domestic reduction commitment of net greenhouse gas emissions (emissions after deduction of removals) of at least 55 % below 1990 levels by 2030.

(4)

In Regulation (EU) 2021/1119 of the European Parliament and of the Council (32) (‘European Climate Law’), the Union has enshrined into legislation the target of economy-wide climate neutrality by 2050 at the latest and the aim to achieve negative emissions thereafter. That Regulation also establishes a binding Union domestic reduction commitment of net greenhouse gas emissions (emissions after deduction of removals) of at least 55 % below 1990 levels by 2030. Furthermore, it establishes that when implementing the target, swift and predictable emission reductions are to be given priority and, at the same time, removals by natural sinks are to be enhanced. The contribution of net removals to the 2030 target is limited to 225 million tonnes of CO2 equivalent, while the rest of the target has to be achieved through direct emissions reductions.

(5)

In order to implement those commitments as well as the Union’s contributions under the Paris Agreement (33) adopted under the UNFCCC, the Union regulatory framework to achieve the greenhouse gas emission reduction target should be adapted.

(5)

In order to implement those commitments as well as the nationally determined Union contributions under the Paris Agreement (33) adopted under the UNFCCC, the Union regulatory framework to achieve the greenhouse gas emission reduction target should be adapted.

(7)

While emissions trading will also apply to greenhouse gas emissions from road and maritime transport as well as buildings, the scope of Regulation (EU) 2018/842 will be maintained. Regulation (EU) 2018/842 will therefore continue applying to the greenhouse gas emissions from domestic navigation, but not to those from international navigation. Greenhouse gas emissions of a Member State within the scope of Regulation (EU) 2018/842 to be taken into account for compliance checks will continue to be determined upon upon completion of inventory reviews in accordance with Regulation (EU) 2018/1999 of the European Parliament and the Council (34).

(7)

While emissions trading may also apply to greenhouse gas emissions from road and maritime transport as well as buildings, the scope of Regulation (EU) 2018/842 will be maintained. Regulation (EU) 2018/842 will therefore continue applying to the greenhouse gas emissions from domestic navigation, but not to those from international navigation. Greenhouse gas emissions of a Member State within the scope of Regulation (EU) 2018/842 to be taken into account for compliance checks will continue to be determined upon upon completion of inventory reviews in accordance with Regulation (EU) 2018/1999 of the European Parliament and the Council (34). However, the emissions of some sectors in past years have either increased or remained stable .

(9)

In its conclusions of 11 December 2020 the European Council mentioned that the 2030 target will be delivered collectively by the Union in the most cost-effective manner possible, that all Member States will participate in this effort, taking into account considerations of fairness and solidarity, while leaving no one behind, and that the new 2030 target needs to be achieved in a way that preserves the Union’s competitiveness and takes account of Member States’ different starting points and specific national circumstances and emission reduction potential, including those of island Member States and islands, as well as efforts made.

(9)

In its conclusions of 11 December 2020 the European Council mentioned that the 2030 target will be delivered collectively by the Union in the most cost-effective manner possible, that all Member States will participate in this effort, taking into account considerations of fairness and solidarity, while leaving no one behind, and that the new 2030 target needs to be achieved in a way that preserves the Union’s competitiveness and takes account of Member States’ different starting points , emission reductions already achieved, and specific national circumstances and emission reduction potential, including those of island Member States and islands, as well as efforts made.

(9a)

Beyond 2030, it is necessary that the Union and each Member State reach the Union-wide climate-neutrality objective by 2050 at the latest with the aim to achieve negative emissions thereafter. Regulation (EU) 2018/842 should ensure that all Member States are brought on emissions trajectories, and adopt concrete long-term policies, that lead to the accomplishment of that objective.

(10)

In order to achieve the target of reducing greenhouse gas emissions by 55 %, the sectors covered by Regulation (EU) 2018/842 will need to reduce their emissions progressively until they reach - 40 % in 2030, compared to 2005 levels.

(10)

In order to implement the Union's commitments under the Paris Agreement and achieve the target of reducing greenhouse gas emissions by at least 55 %, all sectors covered by Regulation (EU) 2018/842 will need to reduce their emissions progressively until they reach - 40 % in 2030, compared to 2005 levels.

(11)

For that purpose, the greenhouse gas emission reduction target for 2030 needs to be revised for each Member State. The revision of the greenhouse gas emission reduction target should use the same methodology that was followed when Regulation (EU) 2018/842 was first adopted, where the national contributions were determined in consideration of the different capacities and cost-efficiency opportunities in Member States so to ensure a fair and balanced distribution of the effort. The reduction of the maximum greenhouse gas emissions for each Member State in 2030 should thus be determined in relation to the level of its 2005 reviewed greenhouse gas emissions covered by this Regulation, excluding verified greenhouse gas emissions from installations that operated in 2005 and which were only included in the emission trading system of the Union after 2005.

(11)

For that purpose, the greenhouse gas emission reduction target for 2030 needs to be revised for each Member State. The revision of the greenhouse gas emission reduction target uses the same methodology that was followed when Regulation (EU) 2018/842 was first adopted, where the national contributions were determined in consideration of the different capacities and cost-efficiency opportunities in Member States so to ensure a fair and balanced distribution of the effort. The distribution of Member State targets nevertheless do not converge, which should be considered when evaluating how the national targets contribute to the objective of climate neutrality by 2050 at the latest in a cost-effective and fair manner. The reduction of the maximum greenhouse gas emissions for each Member State in 2030 should thus be determined in relation to the level of its 2005 reviewed greenhouse gas emissions covered by this Regulation, excluding verified greenhouse gas emissions from installations that operated in 2005 and which were only included in the emission trading system of the Union after 2005.

(11a)

The communication of the Commission of 14 October 2020 on an EU strategy to reduce methane emissions highlighted that methane is a powerful greenhouse gas, second only to carbon dioxide in its overall contribution to climate change. On a molecular level, methane is more powerful than carbon dioxide. Although methane remains for a shorter time in the atmosphere than carbon dioxide, it has a significant effect on the climate. In September 2021, the Union and the United States announced the Global Methane Pledge, to which more than 100 countries in total have since joined. The signatories of the pledge aim to achieve by 2030 the collective goal of reducing global methane emissions by at least 30 % from 2020 levels and enhance reporting standards. Methane, nitrous oxide and so-called F-gases together account for over 20 % of the Union’s greenhouse gas emissions. Given those commitments and the short-lived nature of many of those greenhouse gases, it is appropriate to lay down one or more Union targets for all non-CO2 greenhouse gas emissions in all sectors.

(13)

The COVID-19 pandemic has impacted the Union’s economy and its level of emissions to a degree that cannot yet be fully quantified. On the other hand, the Union is deploying its largest stimulus package ever, also having a potential impact on the level of emissions. Due to those uncertainties, it is appropriate to review the emissions data in 2025 and, if necessary, readjust the annual emission allocations.

(13)

The COVID-19 pandemic has impacted the Union’s economy and its level of emissions to a degree that cannot yet be fully quantified. On the other hand, the Union is deploying its largest stimulus package ever, aiming to ensure a green recovery while also having a potential impact on the level of emissions. It is appropriate to maintain a stable, predictable and ambitious regulatory emissions pathway throughout the ongoing decade in order to ensure both the necessary emissions reductions and planning security.

(14)

It is therefore appropriate to update in 2025 the annual emission allocations for the years 2026 to 2030. This should be based on a comprehensive review of the national inventory data carried out by the Commission in order to determine the average of the greenhouse gas emissions of each Member State during the years 2021, 2022 and 2023.

(14a)

In accordance with Regulation (EU) 2021/1119, priority should be given to reductions in direct emissions, which will have to be complemented by increased CO2 removals in order to achieve climate neutrality. Regulation (EU) 2021/1119 recognises that carbon sinks include natural and technological solutions. The role of technological solutions for carbon removal has also been addressed in several reports of the Intergovernmental Panel on Climate Change, in particular in the Working Group III contribution to the Sixth Assessment Report. It is important that a Union scheme for the certification of safely and permanently stored carbon removals through technological solutions is put in place, offering clarity for Member States and market operators to enhance such removals. When such a certification scheme is in force, an analysis can be made about the accounting of such removals under Union law, including whether the accounting of such removals affects the emissions covered by Regulation (EU) 2018/842, in full respect of conditions set out in Article 4(1) of Regulation (EU) 2021/1119. Such removals are additional and do not offset the necessary reductions in emissions in accordance with the Union climate targets laid down in Regulation (EU) 2021/1119.

(15)

Under Regulation (EU) 2018/842, the cancellation of a limited quantity of emission allowances in the European Union emission trading system may be taken into account for some Member States’ compliance under Regulation (EU) 2018/842. Given the particular structure of Malta’s economy, the national reduction target of that Member State based on Gross Domestic Product per capita is significantly above its cost-effective reduction potential, is is therefore appropriate to increase Malta’s access to that flexibility, without compromising the 2030 target of the Union on emission reductions.

(15)

Under Regulation (EU) 2018/842, the cancellation of a limited quantity of emission allowances in the European Union emission trading system may be taken into account for some Member States’ compliance under Regulation (EU) 2018/842. Given the particular structure of Malta’s economy, the national reduction target of that Member State based on Gross Domestic Product per capita is significantly above its cost-effective reduction potential, is therefore appropriate to increase Malta’s access to that flexibility, without compromising the 2030 target of the Union on emission reductions. The Member States entitled to this flexibility but which did not make use of it in the 2019 context of Regulation (EU) 2018/842, should be given the possibility to revise that decision to take account of the newly proposed national reduction targets. The Member States concerned should also be allowed to revise their notified percentages more often.

(16a)

In order to ensure and incentivise compliance by Member States with respect to their minimum contributions for the period from 2021 to 2030 under Regulation (EU) 2018/842 as amended, corrective actions should be strengthened and more closely connected to the integrated national energy and climate plans under Regulation (EU) 2018/1999. If a Member State exceeds its annual emission allocations during two successive years, that Member State should revise its integrated national energy and climate plan submitted to it in accordance with Regulation (EU) 2018/1999, while giving the public a possibility to participate in the process.

(16b)

The Union and the Member States are parties to the United Nations Economic Commission for Europe (UNECE) Convention on Access to Information, Public Participation in Decision-making and Access to Justice in Environmental Matters (‘the Aarhus Convention’)  (1a) . Public scrutiny and access to justice are an essential part of the democratic values of the Union and a tool to safeguard the rule of law. In the communication of the Commission of 14 October 2020 on improving access to justice in environmental matters in the EU and its Member States’, the Commission recognised that access to justice is not guaranteed in all Member States and called on the Council and the European Parliament to introduce explicit access to justice provisions in sectoral legislation. It is therefore appropriate to lay down a provision to ensure the public’s access to justice for the actions implementing Regulation (EU) 2018/842 as amended.

(16c)

In order to achieve the objectives under Regulation (EU) 2018/842 as amended and other Union legislation, particularly those under Regulation (EU) 2021/1119, the Union and its Member States should make use of the latest science while implementing policies. The advice of the European Scientific Advisory Board on Climate Change, established by Article 3 of Regulation (EU) 2021/1119, should therefore be considered throughout Regulation (EU) 2018/842 as amended, as appropriate.

(18)

The setting of more ambitious targets under Regulation (EU) 2018/841 will decrease the capacity of Member States to generate net removals that can be used for compliance under Regulation (EU) 2018/842. In addition, the split of the use of the LULUCF flexibility into two separate time periods, will further limit the availability of net removals for the purpose of compliance with Regulation (EU) 2018/842. As a result, some Member States may face challenges in meeting their targets under Regulation (EU) 2018/842, while some Member States, the same or other, may generate net removals that cannot be used for compliance with Regulation (EU) 2018/842. As long as the Union objectives as set out in Article 3 of Regulation (EU) 2021/1119 are met, in particular with regard to the maximum limit of the contribution of net removals, it is appropriate to create a new voluntary mechanism, in the form of an additional reserve, that will help adhering Member States to comply with their obligations.

(18a)

Given the long-term dimension of effective climate protection set out in Regulation (EU) 2021/1119 and the Union’s commitment to the objectives of the Paris Agreement, clarity about Member States’ individual long-term reduction pathways beyond 2030 would allow for more accurate policy planning. It is therefore appropriate to include a process setting national reduction pathways for each Member State for climate neutrality by 2050 at the latest.

(-1)

(1)

In Article 1 , ‘30 %’ is replaced by ‘40 %’ ;

(1)

Article 1 is replaced by the following:

‘This Regulation lays down obligations on Member States with respect to their minimum contributions for the period from 2021 to 2030 towards fulfilling the Union’s target of reducing its greenhouse gas emissions by 40 % below 2005 levels in 2030 in the sectors covered by Article 2 of this Regulation. It contributes to the long-term target of climate neutrality in the Union by 2050 at the latest, with the aim to achieve negative emissions thereafter. It thereby contributes to achieving the objectives of Regulation (EU) 2021/1119 and the Paris Agreement. This Regulation also lays down rules on determining annual emission allocations and for the evaluation of Member States’ progress towards meeting their minimum contributions and paves the way for the setting of post-2030 Union’s greenhouse gas emissions reduction targets in the sectors covered by Article 2 of this Regulation.’

(2a)

(3)

In Article 4, paragraphs 2 and 3 are replaced by the following:

(3)

In Article 4, paragraphs 2 and 3 are replaced by the following:

(a)

do not exceed, in the years 2021 and 2022, the limit defined by a linear trajectory, starting on the average of its greenhouse gas emissions during 2016, 2017 and 2018, as set out pursuant to paragraph 3 of this Article, and ending in 2030 at the limit set for that Member State in column 1 of Annex I to this Regulation. The linear trajectory of a Member State shall start either at five-twelfths of the distance from 2019 to 2020 or in 2020, whichever results in a lower allocation for that Member State;

(a)

do not exceed, in the years 2021 and 2022, the limit defined by a linear trajectory, starting on the average of its greenhouse gas emissions during 2016, 2017 and 2018, as set out pursuant to paragraph 3 of this Article, and ending in 2030 at the limit set for that Member State in column 1 of Annex I to this Regulation. The linear trajectory of a Member State shall start either at five-twelfths of the distance from 2019 to 2020 or in 2020, whichever results in a lower allocation for that Member State

(b)

do not exceed, in the years 2023 , 2024 and 2025 , the limit defined by a linear trajectory starting in 2022 at the annual emission allocation for that Member State, as set out pursuant to paragraph 3 of this Article for that year, and ending in 2030 at the limit set for that Member State in column 2 of Annex I to this Regulation;

(b)

do not exceed, in the years 2023 to 2030 , the limit defined by a linear trajectory on the average of its greenhouse gas emissions during 2016, 2017, and 2018, as set out pursuant to paragraph 3 of this Article for that year, and ending in 2030 at the limit set for that Member State in column 2 of Annex I to this Regulation; The linear trajectory of a Member State shall start either at five-twelfths of the distance from 2019 to 2020 or in 2020, whichever results in a lower allocation for that Member State;

(c)

do not exceed, in the years 2026 to 2030, the limit defined by a linear trajectory starting in 2024, at the average of its greenhouse gas emissions during the years 2021, 2022 and 2023, as submitted by the Member State pursuant to Article 26 of Regulation (EU) 2018/1999, and ending in 2030 at the limit set for that Member State in column 2 of Annex I to this Regulation.

(3a)

(3b)

(3c)

(3d)

(a)

in respect of the year 2021, bank that excess part of its annual emission allocation to subsequent years until 2030; and

‘(a)

in respect of the year 2021, bank the excess part of its annual emission allocation up to a level of 5 % of its annual emission allocation to subsequent years until 2025 ; and’

(3e)

(b)

in respect of the years 2022 to 2029 , bank the excess part of its annual emission allocation up to a level of 30 % of its annual emission allocations up to that year to subsequent years until 2030 .

(3f)

(3g)

(3h)

(3i)

(5a)

(-a)

(-ab)

(a)

additional actions that the Member State shall implement in order to meet its specific obligations under Article 4 of this Regulation, through domestic policies and measures and the implementation of Union action;

(a)

additional actions that the Member State shall implement in order to meet its specific obligations under Article 4 of this Regulation, through domestic policies and measures and the implementation of Union action;

(b)

a strict timetable for implementing such actions, which enables the assessment of annual progress in implementation.

(b)

a strict timetable for implementing such actions, which enables the assessment of annual progress in implementation; where a Member State has established a national climate advisory body, it shall seek the advice of this body to identify necessary actions ;

(ba)

a statement of the quantity of additional emission reductions which the Member State estimates will be achieved by those policies and the method used to estimate those additional emission reductions;

(bb)

how the corrective action plan will strengthen the Member State’s integrated national energy and climate plan adopted under Regulation (EU) 2018/1999.

(7)

(a)

any flexibilities used under Articles 11 to 13b of Regulation (EU) 2018/841;

(b)

the quantities taken into account for compliance pursuant to Article 7 of this Regulation.

(a)

the greenhouse gas emissions of the Member State exceed its annual emission allocations in the period from 2026 to 2030;

(b)

the Member State has exhausted the flexibilities pursuant to Article 5(2) and (3);

(c)

the Member State has made the maximum use possible of net removals in accordance with Article 7, even if that quantity does not reach the level set in Annex III; and

(d)

the Member State has made no net transfers to other Member States under Article 5.

(7a)

(7b)

(a)

the suitability of the current national targets under Annex I of this Regulation as regards their contribution to achieving the objective of climate neutrality by 2050 at the latest under Regulation (EU) 2021/1119 in a cost-effective and fair manner;

(b)

a reduction pathway for each Member State of the greenhouse gas emissions covered by this Regulation that is compatible with the objective of climate neutrality for each Member State by 2050 at the latest.

(7c)

(a)

that fail to comply with the legal obligations provided for in Articles 4 to 8 of this Regulation; or

(b)

that are subject to Article 10 of Regulation (EU) 2018/1999.

(a)

they have sufficient interest; or

(b)

they maintain impairment of a right, where administrative procedural law of a Member State requires that as a precondition.

(7d)