Launched in 2005, the emissions trading system is the European Union's main tool for cutting greenhouse gases, which it does by forcing power plants and factories to buy CO2 permits when they pollute and capping the supply of permits.
The revamp, proposed by the European Commission last year, is seen as critical because transport emissions are rising, and most buildings in Europe are heated by fossil fuels, churning out roughly a third of total EU emissions. Scrapping the EU proposal would mean replacing it with far tougher national policies, and the investments to match, the Commission said.
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