Minister of Environmental Protection and Natural Resources Ruslan Strilets has once again stated that Ukraine will launch an emissions trading system in a test mode in 2025 and a full-fledged one in 2026. However, the environmental community considers such deadlines unrealistic.
Accelerating decarbonization and implementing an emissions trading system is one of the European Commission's tasks for Ukraine's European integration, he wrote on his Facebook page.
Strelets emphasized that the government has already begun to implement the European Commission's recommendations, in particular, improved requirements for monitoring, reporting and verification of greenhouse gas emissions (GHG).
"Such innovations will simplify the reporting process of enterprises in the field of MFA and at the same time will allow us to collect and verify data and show the world our potential in terms of free quotas. We plan to launch a pilot national trade system in a year. In 2026, it should be fully operational in Ukraine," wrote Strilets.
It is worth noting that this is not the first time the Minister has announced the creation of an emissions trading system. However, the question arises whether Ukraine will be able to launch the ETS in 2.5-3 years, which the EU has been developing and improving for 17 years.
Earlier, Strelets explained that the ETS can be launched on the basis of a system of monitoring, reporting and verification of greenhouse gas emissions (MRV) based on three years of data. This system was launched in 2021, but during the war, 40% of the installations were destroyed or damaged by the occupiers. Also, the future ETS should cover emissions from Crimea, where a number of outdated enterprises operate.
However, the Ministry of Ecology has not yet published the concept of the future ETS or its roadmap. There is also still no draft law "On the Greenhouse Gas Emissions Trading System," which was launched in 2021. The Verkhovna Rada should adopt the document in 2024 in time to launch the pilot system in 2025.
The adoption of important legislative acts is often delayed, in particular due to numerous amendments, lengthy approvals and discussions. Therefore, there is a risk that the future ETS draft law will suffer the same fate. For example, the European integration framework draft law No. 2207-1-d "On Waste Management" was adopted for more than 2 years, and a year before its entry into force and 4 months afterwards, a number of bylaws are still at different stages of adoption and development.
In 2026, the EU will launch the second phase of the Carbon Based Import Adjustment Mechanism (CBAM). Without an effective ETS, Ukrainian importers will face a tax burden, and the state will lose enormous amounts of money. After all, there are no exemptions or mitigations for carbon duties.
