According to the Turkish newspaper Ekonomim, the European Commission's proposed revision of the EU Emissions Trading System (EU ETS) could reduce future price pressures created by the Carbon Boundary Regulation Mechanism (CBAM) for Turkish exporters by slowing the abolition of carbon quotas and expanding free distributions.
In accordance with the draft announced on July 17, the Commission proposes to reduce the annual reduction rate of emission limits from 4.3 percent to 3.7 percent in the period 2031-35 and further to 1.7 percent in 2036-40, as previously reported by SteelOrbis. A slower reduction in emissions quotas could ease the upward pressure on EU carbon prices in the long term.
,ETS prices directly affect the cost of CBAM. ,
,The proposed changes are particularly important for Turkish companies exporting CBAM-covered products to the EU, as prices for CBAM certificates are linked to prices stipulated by the ETS in the EU. ETS Quotas
The EU is currently trading at around 82 euros per tonne, while the official price of the European Commission's CBAM certificate for the second quarter of 2026 is 75.28 euros per tonne.
Accordingly, a more gradual tightening of the ETS in the EU could moderate the rise in carbon prices and therefore limit the growth of CBAM.- related expenses for Turkish exporters.
,Free benefits may be extended until 2038 ,
,ANOTHER important element of the Commission's proposal concerns phasing out free ETS benefits for sectors covered by CBAM. According to the current system, the free distribution of funds is planned to be completely discontinued in 2034. The European Commission proposes to extend this process until 2038, which will allow for a more gradual consideration of the full impact of carbon costs.
This change will be especially relevant for Turkish exporters of iron and steel, aluminum, cement, fertilizers, electricity and hydrogen, which are covered by the CBAM framework program. Exporters of these products to EU countries are required to account for the carbon dioxide emissions embedded in their products using CBAM certificates.
,Industry benchmarks can provide support in the amount of 6 billion euros. ,
,The Commission also proposes to introduce industry benchmarks for CBAM-covered industries in the period 2026-30, instead of relying on general criteria. The proposed approach is expected to maintain a higher level of free allocations for affected European industries and provide additional support in the amount of about 6 billion euros. For Turkish exporters competing with EU producers, changing these criteria and free distribution will be important to determine
