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The price of emissions allowances (EUA) traded on the European Union's Emissions Trading Scheme (ETS) exceeded ** euros per metric ton of COâ‚‚ for the first time in January 2026. Although average annual EUA prices have increased significantly since the 2018 reform of the EU-ETS, they fell ***percent year-on-year in 2024 to ***euros. In 2025, EU-ETS prices recovered to a maximum-price of euros in January 2025.

What is the EU-ETS?

The EU-ETS became the world’s first carbon market in 2005. The scheme was introduced as a way of limiting GHG emissions from polluting installations by putting a price on carbon, thus incentivizing entities to reduce their emissions. A fixed number of emissions allowances are put on the market each year, which can be traded between companies. The number of available allowances is reduced each year. The EU-ETS is now in its fourth phase (2021 to 2030).

Carbon price comparisons

The EU ETS has one of the highest average annual carbon prices worldwide, averaging ** U.S. dollars as of April 2025. In comparison, prices for UK ETS carbon credits averaged ** U.S. dollars during same period, while those under the Regional Greenhouse Gas Initiative (RGGI) in the United States averaged just ** U.S. dollars.