Clean energy investors need predictability and a long -term framework to deliver on

investments – without such investments, European industries cannot be competitive. The EU

Emissions Trading System (ETS) is a vital tool in this respect . In nucleareurope’s opinion the

EU ETS functions well and therefore discussions should centre around building on this key

block in a way that does not undermine its ambitions .

The EU ETS clean energy helps stimulate investments in both the decarbonisation of indu stry and , ultimately,

assets, such as nuclear. Watering down its ambitions or implementing ad hoc

measures will create uncertainty, potentially putting investments in nuclear capacity at risk .

As highlighted by the European Commission under Acce lerateEU, in order to tackle high energy

costs, the EU must rapidly invest in homegrown clean energy sources & the electrification of

industrial processes. The EU ETS can play a role in encouraging such investments.

An efficient use of ETS revenues by Member States is paramount for the transition of the EU

economy and targeted support of industry sectors engaging in decarbonisation investments.

Revenues raised through the sale of allowances should be used for climate action, such as

investments in the decarbonisation of industrial processes (e.g. electrification) . At the same time, it

is important that industry is given the freedom to choose whichever clean energy source best meets

their needs, and to avoid imposing re strictions (such as an in situ requirement for the generation of

that energy source) .

Energy-intensive sectors are fundamental to the European economy and play a critical role in

supporting net zero value chains throughout the EU. nucleareurope acknowledges the concerns of

energy-intensive industries on carbon leakage , and short -term protection measures could be

considered until C arbon Border Adjustment Mechanism (CBAM) is fully operational (for those

sectors which fall under its scope), including continuation of free allocation in a transitional form, as

well as indirect cost compensation. Such measures find their purpose when tied to credible

decarbonisation plans and investment commitments , turning a policy requirement into a pathway

to a cleaner industrial base. As mentioned above, re -directing ETS revenues towards

decarbonisation investments can also support their competitiveness.

We also recogni se that the EU ETS affects individual countries and regions in different ways. The

revision should take this into account in order to ensure a socially just transition, and the revised

directive should include appropriate solidarity mechanisms, such as the continuation of t Modernisation Fund .

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Furthermore, attention should be paid to the use of international carbon credits to ensure that such

measures do not trigger an investment leakage.