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Press release
10-12-2025
ENVI
2040 climate target: deal on a 90% emissions reduction in EU climate law [3]
>From 2036, five percentage points of emissions reductions could come via international carbon credits
The EU emissions trading system ETS2, which covers CO2 emissions from fuel combustion in buildings and road transport, to be postponed until 2028
Progress report every two years with possibility to review 2040 target
Co-legislators agree on a 90% reduction target for greenhouse gas emissions by 2040, compared with 1990 levels, to achieve a climate neutral EU by 2050.
On Tuesday evening, negotiators from Parliament and Council reached a provisional political agreement on an amendment to the EU Climate Law [4], setting a new, intermediate and binding 2040 EU climate target of reducing net greenhouse gas (GHG) emissions by 90% compared to 1990 levels.
Flexibility for member states*
Co-legislators agreed to introduce new flexibilities in how the 2040-target can be met as they believe the green transition and improving EU competitiveness go hand in hand.
>From 2036, up to five percentage points of the emissions reductions (two percentage points more than proposed by the Commission) can come from high-quality international carbon credits compatible with the Paris Agreement [5] . Following a push from Parliament, further safeguards to the international carbon credits were incorporated in the text including the prevention of funding of projects in partner countries that run contrary to the strategic interests of the EU.
The Commission will analyse different options for the role of international credits in the upcoming EU climate legislation to reach the 2040-target and in this context made a statement recalling the need to ensure the stability of the EU emissions trading system (EU ETS) [6] .
The deal also includes the possibility for domestic permanent carbon removals [7] to be used to compensate for hard-to-abate emissions in the ETS as well as enhanced flexibility within and across sectors and instruments to achieve targets that are as cost effective as possible.
The introduction of the EU’s ETS2 [8] will also be postponed by one year from 2027 to 2028. ETS2 covers CO2 emissions from fuel combustion in buildings and road transport.
Review of the 2040 target*
The Commission will assess progress every second year, considering the most recent scientific data, technological developments, and the EU’s international competitiveness.
The review will assess the status of net removals at the EU level compared with what is necessary to meet the 2040 goal, as well as emerging implementation issues and the potential for enhancing EU industrial competitiveness. The review will also consider trends in energy prices and their repercussions for both businesses and households.
Following the conclusions of the review, the Commission will propose an amendment to the EU climate law if appropriate. This could involve modifying the 2040 target or taking additional measures to strengthen the supporting framework – for instance to safeguard the EU’s competitiveness, prosperity, and social stability.
Next steps*
Parliament will now vote on the informal agreement and Council will also have to endorse it. It will enter into force 20 days after it has been published in the EU Official Journal.
Background*
The European Climate Law makes the goal of climate neutrality by 2050 a legally binding obligation for all EU member states. It also establishes a legally binding target for the EU to reduce net GHG emissions by at least 55% by 2030, compared to 1990 levels.
Further information
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Committee on the Environment, Climate and Food Safety
Thomas HAAHR
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