In a letter to European leaders, industrial and investment majors said the upcoming revision of the ETS should be used to improve its design in “very targeted ways,” rather than amending or suspending it.

The ETS is Europe’s internal levy on industrial emitters of carbon dioxide (CO2), with prices currently averaging €80 ($91.8) to €100 ($114.7) per tonne of CO2 emitted. The scheme is designed to encourage emitters to decarbonise. Revenues are then reinvested by the EU into clean energy projects.

It is seen as an effective way to drive clean hydrogen use across industries.

With oil and gas prices skyrocketing amid conflict in the Middle East, some have called on the EU to relax the scheme to ease the cost burden on industrials and consumers.

However, a 150-strong group, including the likes of oil and gas player Moeve, investor Copenhagen Infrastructure Partners, and German steel firm Salzgitter, said this would be a short-term solution to a long-term problem.

“Europe’s security and sovereignty hinge on building a more competitive and resilient economy, moving away from volatile fossil imports towards capitalising on our clean energy potential,” the letter said. “In our view, a robust EU ETS is critical to achieving this.”

European industry faces mounting pressure from structurally high energy costs, decarbonisation demands, and cheaper imports.

The group called this a “misdiagnosis” of Europe’s industrial challenges.

It warned that weakening the scheme would “erode investment certainty and damage Europe’s industrial future,” adding that the ongoing debate is already having a chilling effect on capital markets.

Instead, the organisations argued the EU should assess near-term options to support industry, continue deployment of clean power, ensure overseas carbon taxes are applied effectively, and ensure ETS revenues are “effectively disbursed.”

They urged the European Council to remove “ambiguity” over the ETS by issuing a clear statement at its 19–20 March meeting.