EU ETS 2024: Emissions Down by 5%, but Industry Struggles to Decarbonize

In 2024, the European Union Emissions Trading System (EU ETS) recorded a 5% decrease in verified emissions compared to the previous year. While the headline figure is positive, a closer look reveals a more complex picture: the reduction was driven almost entirely by the energy sector, while manufacturing industries showed increasing difficulty in cutting emissions.

In this article, we analyze the latest data, sector-specific trends, and what businesses need to do to prepare for the evolving regulatory landscape.

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EU ETS Emissions in 2024: Key Figures

According to official data from the European Commission, verified emissions under the EU ETS fell by 5% in 2024, covering energy production, industry, and intra-European aviation.

Energy Sector: Driving the Reduction

The energy sector posted a 10.5% decrease in emissions, totaling 453.8 Mt CO₂, thanks to:

• Increased renewable energy production (+8%) and nuclear generation (+5%)

• Significant reductions in emissions from gas (-8%) and coal (-15%)

• Solar (+19%) and hydro were the main contributors, while wind remained stable due to less favorable weather conditions

Industry: Minimal Gains, Structural Challenges

Industrial emissions fell by just 1.7%, reaching 579.6 Mt. In many cases, reductions were linked more to production slowdowns or plant closures than to actual decarbonization efforts.

Breakdown by sector:

• Cement: -5%

• Fertilizers: +7%

• Metals: -1.6% (2.4 Mt), with increased exports offsetting weaker domestic demand

Aviation: Emissions Up Due to Expanded Coverage

Intra-EU aviation emissions rose by 15%, mainly due to the inclusion of flights to and from the EU’s outermost regions (e.g., Canary Islands, Azores, Martinique) under the EU ETS, which were previously excluded.

Maritime Sector: First Year in the EU ETS

2024 marked the entry of the maritime sector into the EU ETS. Shipping operators are now required to surrender allowances for 40% of their CO₂ emissions.

So far, 1,000 out of 2,600 companies have reported their emissions, totaling 39.2 Mt CO₂. The compliance obligation for 2024 is estimated at around 15.7 Mt but will increase as more data becomes available.

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Industry Under Pressure: Decarbonization Gets Tougher

The key message from 2024 is clear: while the energy sector is benefiting from more scalable and cost-effective solutions, manufacturing industries are reaching the limits of incremental efficiency.

Further decarbonization will require long-term investment, innovation, and a transformation of supply chains. Meanwhile, with carbon prices rising and ETS2 expanding to buildings and road transport in 2025, regulatory pressure will intensify.

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What Companies Should Do Now

To remain competitive and compliant, companies need to take a more strategic and forward-looking approach to emissions management.

1. Develop Effective Decarbonization Strategies

To reduce regulatory exposure, respond to stakeholder expectations, and anticipate sector trends.

2. Introduce Internal Carbon Pricing Models

Assigning an internal price to CO₂ emissions helps assess the carbon intensity of operations and steer investment decisions in line with future carbon cost scenarios.

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Vision, Method, and Tools Are Essential

The EU ETS is evolving rapidly. Businesses that invest today in understanding and managing their carbon footprint will gain a strategic advantage tomorrow.

If your company is navigating compliance challenges, planning its decarbonization strategy, or exploring carbon pricing tools, we’re here to help.

📩 Contact us for a customized assessment.