ETS2: the carbon price coming for fuels in 2027

From 2027 a second EU trading system prices CO2 from heating and road-transport fuels — upstream, on fuel suppliers, flowing straight into gas and diesel prices. Different market, same direction.

Calculate your carbon bill →CBAM guide

ETS1 vs ETS2

	ETS1	ETS2
Covers	power, industry, aviation, maritime	heating & road-transport fuels
Who holds allowances	the emitting installation	fuel suppliers (upstream)
Start	2005	2027
Price control	MSR	soft cap ≈€45 (2020 prices): extra allowances released above it
Typical payer	plant operator	every gas/diesel buyer via the fuel bill

What it means for industry

Sites OUTSIDE ETS1 (smaller boilers below thresholds, off-grid heating) will meet a carbon price for the first time through their fuel invoices — ≈€45/t means roughly +€9/MWh on natural gas. Mid-size food plants, breweries and district-heat customers should screen efficiency projects against this 2027 line item now: the measures list applies one-to-one.

Inzonex removable modular insulation on industrial equipment

Cut the tonnes at the source

Hot industrial equipment? Cut the heat loss.

Boilers, kilns, heat exchangers, valves and steam lines lose energy continuously. Inzonex makes patented (UK GB2508992.1) removable modular insulation — snap-fastened covers engineered per temperature tier, not generic off-the-shelf jackets:

Up to 90% less heat loss from insulated surfaces
Surface temperature ≤45 °C — touch-safe for workers (EN ISO 13732-1)
6× faster maintenance access than fixed cut-and-weld lagging — unclips and refits in minutes, no destruction
Inspectable — comes off to check for corrosion under insulation, then refits like-new (generic jackets often don't survive removal)
Typical payback under 2 years (some 9–11 months)

See Inzonex process-equipment insulation →Run the savings study

Social Climate Fund

ETS2 revenues feed the Social Climate Fund (€65bn+) for vulnerable households and small businesses — the political counterweight that makes the system durable. For industry the message is simpler: the untaxed-fuel era ends in 2027 for everyone, not just big installations.

FAQ

Questions

What is ETS2?

The EU's second emissions trading system, starting 2027, covering CO2 from heating and road-transport fuels — applied upstream on fuel suppliers and passed through in fuel prices.

What will ETS2 cost per MWh of gas?

At the ≈€45/t soft-cap level: roughly €9 per MWh of natural gas (0.2 t/MWh × €45) added to bills from 2027.

Does ETS2 replace ETS1?

No — they run in parallel and cover different emissions. An industrial site can be in ETS1 for its big boilers AND feel ETS2 in purchased fuels for smaller uses.

Is the €45 a fixed cap?

Soft cap: if the price exceeds ≈€45 (indexed from 2020 prices), additional allowances are released. It's a brake, not a guarantee.

How this page is built: heat-loss figures follow ASTM C680 / ISO 12241 (the method behind our public calculators); facility emissions from Climate TRACE & EU ETS verified data across 30,000+ industrial sites; the 2026–2034 schedule is Regulation (EU) 2023/956, not a forecast. Published by Inzonex — manufacturer of modular removable insulation (UK Patent GB2508992.1). Spotted an error? Tell us — we correct on evidence.