Copyright

Andreas Eisl; Phuc-Vinh Nguyen

Published On

2025-12-08

Page Range

pp. 205–222

Language

  • English

Print Length

18 pages

13. Making the ETS2 Socially Acceptable through Carbon Revenue Redistribution and Investments

Chapter of: More with More: Investing in the Energy Transition: 2025 European Public Investment Outlook(pp. 205–222)
The introduction of a CO2 price for housing and mobility is a key measure to ensure that the EU will be able to achieve its climate objectives. However, without adequate accompanying compensation and investment measures, additional costs for citizens will not be socially acceptable and might lead to a reversal of climate policies. This chapter thus sets out to make recommendations on how to best design accompanying policies in the context of the introduction of the ETS2, which will broaden the scope of the European Emissions Trading System to new economic sectors (road transport, buildings, and small industries). To draw lessons from already existing instruments, this chapter studies the carbon taxation schemes of France, Germany, and Austria as well as their accompanying redistribution and investment measures. Based on this analysis, it highlights the importance of strict earmarking of ETS2 revenues and the visibility of support measures, and discusses how to best target citizens through redistributions mechanisms and balance compensation with investment tools.

Contributors

Andreas Eisl

(author)
Senior Research Fellow at Institut Jacques Delors
Associated Researcher at Sciences Po, Paris
https://orcid.org/0000-0002-1916-2873

Andreas Eisl is a Senior Research Fellow in European Economic Policy at the Jacques Delors Institute and Associated Researcher at Sciences Po. As a comparative political economist, his expertise is centred on EU economic governance, macroeconomic and budgetary policies, as well as industrial policymaking, with a particular focus on the financing of the green transition. Currently, he works on the development of key instruments for a clean EU industrial policy and the implementation of the reformed European fiscal framework. Eisl holds a PhD in political science from Sciences Po and the Max Planck Institute for the Study of Societies (MPIfG)/University of Cologne, as well as a Master’s degree in geography from the University of Salzburg. He has taught at Sciences Po and the Sorbonne Nouvelle.

Phuc-Vinh Nguyen

(author)
Head of the Jacques Delors Energy Centre and a Research Fellow on French and EU energy policy at Institut Jacques Delors

Phuc-Vinh Nguyen is the Head of the Jacques Delors Energy Centre and a Research Fellow on French and EU energy policy at the Jacques Delors Institute. At the European level, his expertise is centred on the political dynamic surrounding the European Green Deal and more precisely, the carbon markets (ETS1 and ETS2) and the gas and electricity markets. At the French level, he works on the deployment of renewable energy sources and nuclear energy. Nguyen holds a Master’s degree in European Business Law Business Law (Université Jean Moulin Lyon III) and a Master’s degree in Energy Law (Université Paris I Panthéon-Sorbonne). He teaches European Energy Policy at Sciences Po Paris, HEC, and IRIS-SUP.