FEAD highlights key priorities following the European Commission’s proposal to revise the EU Emissions Trading System

Brussels, 17 July 2026 – The European Commission published today its proposal to revise the EU Emissions Trading System (ETS), aligning it with the EU’s 2040 climate target. The proposal introduces important developments, including provisions on carbon capture, carbon removals and increased support for industrial decarbonisation through a new Industrial Decarbonisation Bank and stronger investment requirements for Member States.

Of particular relevance for the waste management sector, is the proposed extension of the ETS to non-hazardous waste incineration and co-incineration installations from 2031 under a gradual phase-in until 2034, while allowing Member States to apply a temporary national opt-out where ‘equivalent measures are in place’. It maintains the exclusion of hazardous waste treatment from the ETS, an important element welcomed by FEAD given the sector’s essential role in protecting human health and the environment.

In addition, the proposal introduces monitoring, reporting and verification (MRV) requirements for non-hazardous landfills and expands the use of ETS revenues to support waste prevention, reuse, recycling and other measures higher up the waste hierarchy.

“The Commission’s proposal has a major direct impact on the waste management sector,” said Paolo Campanella, Secretary General of FEAD. “The sector has long contributed to Europe’s climate and circular economy objectives through an integrated approach based on the waste hierarchy. As the legislative process moves forward, it will be essential to provide operators with a stable and predictable investment framework that supports an effective decarbonisation while recognising the complementary role of all waste treatment operations.”

FEAD therefore highlights the following points for the legislative discussions ahead:

• Avoid double carbon pricing. The inclusion of waste-to-energy in the ETS must not result in double taxation where operators are already subject to national carbon taxes or equivalent environmental levies.
• Ensure the polluter pays principle reaches upstream. Producers of non-recyclable products and materials should bear responsibility for the residual waste and emissions those products generate, rather than leaving these costs solely to waste operators and, ultimately, citizens.
• Keep circularity at the centre of decarbonisation. Emissions reductions from incineration plants cannot be pursued in isolation: they must go hand in hand with better collection, sorting and recycling of plastics, and with safeguards that keep the waste hierarchy at the centre of policy.
• Carbon capture is not a silver bullet. Carbon capture technology is not technically or economically deployable at every incineration plant. The revised ETS, and the funding instruments attached to it, must recognise this and support a realistic mix of decarbonisation pathways rather than assuming uniform carbon capture uptake across the sector.
• The inclusion of landfills for MRV purposes must not include legacy emissions from waste that was landfilled in the past. Moreover, there is currently no standardised measuring and quantification method for diffuse methane emissions, which poses a significant challenge to be properly addressed.
• Reinvest ETS revenues in the sector. Revenues generated by waste-to-energy installations should support the decarbonisation of the waste management sector and the transition towards higher levels of the waste hierarchy. FEAD therefore welcomes the twofold Commission’s proposal to strengthen the use of ETS revenues. .
• Integrate carbon removals through a practical framework. FEAD supports a simple one-to-one link between verified carbon removals and ETS allowances, based on a system that is practical for operators and does not rely on unnecessarily complex installation-level calculations.

FEAD looks forward to engaging constructively with the European Parliament and the Council to ensure the final text delivers real decarbonisation while preserving a stable, investable environment for the operators who will have to deliver it on the ground.

FEAD, the European Waste Management Association, represents the entire waste management value chain, from collection and sorting to recycling, energy recovery, and final disposal. It brings together the private waste and resource management industry across Europe through its 21 national member associations and associate members, which collectively represent over 3,000 companies. Together, the sector provides more than 500,000 local jobs and fuels €5 billion in investments into the economy every year. For more information, please contact: info@fead.be