![\"Facilities](\"https:\/\/www.europesays.com\/europe\/wp-content\/uploads\/2026\/06\/e3d0dd6cb9b3e75227a589dbf022b50a.jpeg\")
Facilities operated by chemical giant BASF in Germany (Kirill KUDRYAVTSEV) \u00b7 Kirill KUDRYAVTSEV\/AFP\/AFP <\/p>\n Facilities operated by chemical giant BASF in Germany (Kirill KUDRYAVTSEV) \u00b7 Kirill KUDRYAVTSEV\/AFP\/AFP <\/p>\n
German chemical giant BASF has urged an overhaul of the European Union’s flagship carbon market scheme, warning that the initiative’s “strict” conditions could damage the region’s industries.<\/p>\n
In response to growing complaints, the EU will later this year undertake a broad review of its Emissions Trade System (ETS), which was set up in 2005 to help tackle climate change.<\/p>\n
The scheme has heavy polluters pay for the greenhouse gases they emit, obliging them to buy allowances that are capped in number, sold in auctions and tradeable.<\/p>\n
But criticism is mounting from some member states, including Germany and Italy, as well as major firms that the ETS is an added burden at a time industry is already struggling.<\/p>\n
Adding his voice to the concerns, BASF chief executive Markus Kamieth said there are “currently quite a number of weaknesses in the ETS system”.<\/p>\n
“We are advocating that we take another close look at this, asking how we can design it so that it becomes more flexible,” he told journalists late Monday.<\/p>\n
While stressing that he supported the “basic idea” of the system, he added: “The framework conditions are so strict that in the end it will cost us many jobs, a lot of value creation, and probably also resilience.”<\/p>\n
BASF is among the world’s biggest chemical companies, and a key supplier to industries ranging from automotive to agriculture.<\/p>\n
Calls for the ETS to be\u00a0eased have grown more urgent since the Iran war sent energy costs soaring.<\/p>\n
EU chief Ursula von der Leyen in March promised updates to the system, including “a more realistic trajectory” for cutting emissions and the allocation of “free emission allowances” — currently set to be phased out by 2034 — “beyond 2035”.<\/p>\n
Critics have urged an even greater overhaul.<\/p>\n
Kamieth also warned of more supply chain disruptions from the Iran war later this year.<\/p>\n
“In addition to inflationary pressure, which will certainly lead to weakening demand, there will also be supply chain problems and disruptions,” he said.<\/p>\n
“A manufacturer can’t build a car if they’re missing one component.”<\/p>\n
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