FOCUS – Italy and Czechia ask Brussels to ease rules to protect industry

Italy and Czechia have asked the European Union to ease some of its climate rules, warning that high energy prices and carbon costs could cause long-term damage to European industry, according to Euronews.

In a letter, Rome and Prague warn that the combination of high energy prices, carbon costs and high fuel prices is weakening European production and could accelerate the relocation of investment and factories outside the EU.

Italian Prime Minister Giorgia Meloni visited her Czech counterpart, Andrej Babis, in Prague last week to coordinate the two countries’ position ahead of the upcoming summit of EU leaders.

Italy and Czechia are targeting in particular the European carbon market, the ETS, as well as the latest rules on methane emissions.

They are trying to build a broader coalition within the European Council to change some of these policies.

One of the main demands is the extension of free carbon emission allowances for heavy industry, as well as the suspension of the planned reduction of those allowances for sectors affected by the EU’s carbon border tax mechanism.

Rome and Prague consider the measures temporary and say they would help industry without abandoning long-term climate goals.

However, some of the proposals would amount to significant changes in how the EU implements its climate rules for industry.

Italian Defence Minister Guido Crosetto has gone further, calling for a temporary suspension of the ETS until economic conditions improve.

He argued that the current costs of the carbon system are putting European industry at a disadvantage against international competition.

The Meloni–Babis initiative is part of broader pressure within the EU to give industrial competitiveness more weight in climate policies.

Austria has also called for measures to preserve production and jobs in Europe, while the issue is expected to be among the main topics of discussion at the EU leaders’ meeting on 15 October.