BRUSSELS, 21 October 2025: The European Commission has proposed a series of targeted adjustments to the European Union’s climate policy framework, aimed at securing political backing for the bloc’s 2040 emissions-reduction target. In a letter sent to EU heads of state on Monday, Commission President Ursula von der Leyen outlined revisions to carbon pricing mechanisms and land use regulations, as well as new support measures for households impacted by the green transition.
The proposals come ahead of a key European Council summit where leaders are expected to debate the Commission’s recommendation to cut net greenhouse gas emissions by 90 percent from 1990 levels by 2040. The Commission’s proposed pathway, unveiled in February and reinforced in July, includes the possibility of using international carbon credits for up to 3 percentage points of the target, allowing member states to partially meet their obligations through emissions offsets.
In the letter, von der Leyen emphasized that achieving a decarbonized economy is essential for long-term competitiveness, stating that clinging to outdated economic models would not serve Europe’s strategic interests. Her remarks referenced the need for structural economic shifts and acknowledged that not all sectors would remain viable under the climate transition.
One of the key areas addressed is the EU’s carbon pricing system. Von der Leyen confirmed that the Commission is reviewing the design of the new emissions trading system (ETS II), which is scheduled to take effect in 2027 and will apply to fuels used in road transport and buildings. The scheme has drawn criticism from several member states over concerns it could lead to a sharp rise in fuel costs for consumers.
Carbon pricing reforms aim to support EU households
To address these concerns, the Commission is examining a more robust price stabilization mechanism within ETS II and is considering expanding financial assistance to households affected by energy price increases. The proposal includes possible adjustments to the Social Climate Fund, which was established to support vulnerable consumers during the transition.
The letter also responds to calls from several governments to revise the carbon pricing trajectory for energy-intensive industries. While no specific figures were disclosed, von der Leyen committed to presenting a “realistic and feasible” roadmap for sectors such as steel, cement, and chemicals, which are covered by the existing EU Emissions Trading System. Another policy under revision is the EU’s framework for land use, land-use change, and forestry (LULUCF), which governs how much carbon dioxide can be absorbed by natural ecosystems.
Commission acknowledges wildfire impact on forestry goals
Some member states have argued that current LULUCF targets are unachievable due to increasing wildfire activity and the operational needs of national forestry sectors. Von der Leyen confirmed that the Commission is working on technical solutions within the scope of the existing regulation to address these implementation challenges. The proposed adjustments reflect concerns raised by member states during previous climate negotiations and represent an effort by the Commission to maintain momentum toward the EU’s 2050 climate neutrality goal while ensuring economic and social stability across the bloc.
European Union leaders are expected to deliberate on the 2040 target and related legislative changes during their upcoming summit in Brussels. The outcome of the discussions will determine the scope and pace of the next phase of the EU’s Green Deal policies, which aim to align the bloc’s economic development with its climate objectives. – By EuroWire News Desk