European Commission report on EU carbon market functioning 2024

The European Commission published the report COM(2025) 735 final on the functioning of the EU carbon market in 2024, presenting emissions, auction revenues, cap adjustments and measures for 2026.

• Main announcement/action: The Commission reports that the EU ETS generated EUR 38.8 billion in auction revenue in 2024 (EUR 24.4 billion to Member States; EUR 6.3 billion to the ETS Modernisation Fund; EUR 2.3 billion to the ETS Innovation Fund; EUR 5.6 billion to the RRF for REPowerEU). It sets the 2026 cap (e.g. 1 185 420 090 allowances for electricity/heat/industry/maritime and 24 903 076 allowances for aviation) and records adjustments due to maritime scope expansion and planned rebasing, including the cancellation of 54 243 768 allowances for 2024 to be carried out in 2026.

• Background and additional details: The report details implementation of ETS2 (upstream system for buildings and road transport) and the Social Climate Fund (SCF) (EUR 65 billion 2026-2032, mobilising at least EUR 86.7 billion including Member State minimum 25% contributions). It records the TNAC at 1.15 billion allowances (triggering MSR withdrawals of 276 million allowances Sep 2025–Aug 2026), auction price statistics (2024 average EUR 64.74/t CO2, high EUR 75.35, low EUR 49.50), and Innovation Fund portfolio and calls (portfolio planned support EUR 11.3 billion by July 2025; new calls totalling EUR 4.6 billion launched end-2024/2025).