Bogdan Tudorache

On 1 January 2020, Switzerland will become the first country to successfully link its greenhouse gas emissions trading system with the EU emissions trading system (EU ETS), the EU Council announced.

This completes a process which has taken almost 10 years. On 17 December 2010, the Council authorised the European Commission to open negotiations with the Swiss Confederation for this agreement. The formal procedures for the linking have now been completed, and the agreement can enter into force on 1 January 2020.

The EU ETS is one of the main tools for the cost-effective reduction of greenhouse gas emissions in particular from energy-intensive industries and power plants. This agreement will be mutually beneficial for the EU and the Swiss Confederation, as linking cap and trade systems can increase the availability of reduction opportunities and enhance the cost-efficiency of emissions trading.

According to the rules of the EU ETS, it can be linked with other emissions trading systems provided they are mandatory, have an absolute cap on emissions and are compatible with it, as it is the case with the Swiss system.