IATE Term of the Week: Emissions Trading System

December 15, 2017 1:37 pm

From December 11th – 14th it was a plenary week for the European Parliament in Strasbourg.
The capital city of Alsace was in the middle of hosting its famous Christmas markets; the atmosphere in the streets was merry and joyful, while just outside the centre, the MEPs were discussing and voting for the parliamentary agenda.
During the week, the Parliament called for the international exemption of EU Emissions Trading System (ETS) rules until December 2020, continuing current limitations of scope for aviation activities and preparing to implement a global market-based measure from 2021. With the vote, amendments have been adopted to the proposal for more regulation.

The final act was signed on December 13th; therefore, we have chosen Emissions Trading System as our latest IATE Term of the Week.




The European Union Emissions Trading System (EU ETS) is the largest greenhouse gas emissions trading scheme in the world, and the first one to be established, back in 2005; operating in all 28 EU countries, plus Iceland, Liechtenstein and Norway, it is also known as European Union Emissions Trading Scheme.
As one of the major pillars of EU climate policy, its aim is to fight global warming by limiting and controlling air pollution and gas emissions; it is based on the ‘cap and trade’ principle, which involves making businesses pay for producing greenhouse gas emissions.
Usually, a governmental body is the authority in charge of setting and selling the number of permits to discharge precise amounts of a specific pollutant per time period. These quantities are limited in number; If any body wants to increase their emissions, they have to buy permits from others willing to sell them. The cap applied is a single, EU-wide limit, and has recently replaced the previous national ones.
We are now in the third phase of the project, lasting until 2020, and part of the environmental goals that the EU has set for that year. Putting a price on carbon and trading is a system that works: emissions from the installations in the scheme are falling, and by 2020 emissions from the sectors covered will be 21% lower than in 2005. Similarly, by 2030 they would be 43% lower.

Today, this cap and trade system covers around half of the EU emissions and more than three quarters of the international carbon market.
Flexibility, cost-effectiveness and business-friendliness: these are the three approaches that this deal is able to combine. The system is raising more and more interest among companies and governmental entities worldwide.


In IATE, the definition of the Emissions Trading System is ‘a system whereby the total amount of emissions is capped and allowances, in the form of permits to emit CO2, can be bought and sold to meet emission reduction objectives‘.
The term is covered in IATE in 22 EU languages:




Hoping that you enjoyed our IATE Term of the Week, we will turn up next Friday with our weekly IATE term!


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  • EU Emissions Trading System (EU ETS) – texts adopted, available here (accessed on December 14th, 2017)
  • Plenary Agenda, available here (accessed on December 14th, 2017)
  • EU Emissions Trading System (EU ETS), official website, available here (accessed on December 13th, 2017)



Written by Carolina Quaranta – Schuman Trainee at the Terminology Coordination Unit of the European Parliament. Completed a Master in Public and Political Communication in the University of Torino, Italy; communication specialist and journalist.

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