Press statement: EU ETS proposal is a step in the right direction — but not the leap aviation and shipping need

London, 17 July 2026: The European Commission’s proposal for revising the EU emissions trading system (ETS) published today takes some positive steps but ultimately did not suggest the radical shift needed to help maritime and aviation decarbonise at the necessary pace.

While the proposal as it stands would successfully redirect a great share of ETS revenues to the sectors, including to zero carbon technologies, it still lacks structural changes that would best drive investment in Europe's clean aviation and maritime.

Aurelia Leeuw, Director of EU Policy at the SASHA Coalition, said:

“Although we recognise the European Commission’s efforts to move forward from the nearly 15 year-stalemate since the initial exemption of international flights from the EU emissions trading system, we believe at only including international flights landing within a 5,000km radius of Europe will barely dent the problem the ETS is meant to tackle. A vast number of long-haul flights go to China and the US – precisely the destinations this proposal would exempt. Europe needs to stand up for its industry, its innovation and its competitive standing in the world. It won’t do that by bowing to threats and foreign influence. 

We look forward to interacting with the European Parliament and the Council to ensure a more ambitious stance emerges – one where pollution is adequately priced, where price parity between sustainable alternatives and fossil fuels becomes a realistic long-term outcome, and where a signification share of ETS revenues is reinvested into the sector’s decarbonisation.”

For aviation, the proposal was positive in that it would extend allowances, incentivising European production of the most sustainable energy systems, and takes steps towards longer-term certainty through ex-ante contracting mechanisms are strong developments.

However, it misses the greatest opportunity for Europe's clean aviation industry: meaningfully extending the EU ETS to international flights. It also falls short of earmarking allowances for the cleanest technologies, and e-fuels’ support is cut significantly. Reducing the policy differentiation between the greenest and less sustainable energy systems may dilute support precisely where Europe needs it.

On shipping, the proposal takes the strong step of suggesting an extension of the ETS to 400-5,000 GT vessels. Increasing dedicated allowances and strong price differential coverage for sustainable maritime fuels and zero emission technologies, are also highly welcome investments signals.

Nevertheless, the proposal still fails to sufficiently differentiate between the cleanest technologies and lower-carbon alternatives, meaning public support risks being misspent on potentially damaging non-solutions. The exemption (at least until 2031) of ferries below 5,000 GT is a missed opportunity to accelerate one of Europe's most ready to decarbonise shipping segments.