ETS2 2027: compensation for fuel consumers and costs for distributors

Key data

From 2027, paying to fill up your tank or heat an industrial facility will have an additional cost that did not exist before: the price of CO2. The Commission Implementing Regulation (EU) 2026/2467, published on 6 November 2026, develops the mechanism for financial compensation for end consumers of fossil fuels under the ETS2 system, the extension of the European emissions trading market to road transport and buildings.

This is not a proposal: the regulation is already in force as of 5 November 2026 and requires Member States to design their national compensation mechanisms within the European framework. Fuel distribution and trading companies are working against the clock.

What does this regulation establish?

The regulation develops two major components of the ETS2 system applied to fossil fuels:

• Financial compensation mechanism for end consumers: users of petrol, diesel and natural gas will be entitled to receive economic compensation to mitigate the impact of CO2 prices on their bills. Member States are responsible for passing these compensations to end users and have flexibility to design specific national mechanisms within the European framework.
• Treatment of emission allowances outside Chapter IV bis: the regulation specifically regulates what happens to emission allowances delivered for emissions that fall outside the scope of Chapter IV bis of the Directive 2003/87/CE, avoiding gaps or double counting in the system.

The fuels expressly included in the scope of application are:

Economic and operational impact

ETS2 introduces a new and structural cost on fossil fuel consumption. Unlike ETS1 (which affected large industrial installations and power generation), ETS2 reaches directly to the pump and the gas bill.

The main economic and operational consequences for companies are:

• Distributors and traders: will have to assume new reporting obligations and delivery of emission allowances to the competent authorities. This involves investment in tracking systems, emissions accounting and regulatory compliance.
• Fuel-intensive sectors: transport, logistics and industrial heating are the most exposed. The price of CO2 will be passed on to operating costs, making fleets, routes and processes that depend on petrol, diesel or natural gas more expensive.
• End consumers: will receive financial compensation, but the specific design (amount, form of payment, frequency) depends on each Member State. Until Spain defines its national mechanism, the exact amount is uncertain.
• Member States: have flexibility to design compensation mechanisms, which may create competitive differences between EU countries in sectors such as international transport.

Who does it affect?

• Fuel distributors (petrol, diesel, natural gas): new reporting obligations and delivery of emission allowances.
• Fuel traders: same regime of obligations as distributors.
• Road transport and logistics companies: direct impact on operating costs due to the CO2 price incorporated into fuel.
• Companies with intensive natural gas consumption for industrial heating or production processes.
• CFOs and financial directors of any company with a vehicle fleet or significant consumption of fossil fuels: must model the impact on their budgets from 2027.
• Individual end consumers entitled to compensation according to the mechanism designed by each Member State.
• Public administrations with fleets or buildings that consume fossil fuels.

Practical example

A logistics company with a fleet of 50 diesel trucks currently operates without CO2 cost on that fuel. From 2027, with the entry into force of ETS2, the price of CO2 will be incorporated into the price of diesel through the emission allowance delivery obligations assumed by distributors.

That distributor will, for the first time, have to report the emissions associated with the diesel it markets and deliver the corresponding emission allowances. The cost of those allowances will be passed on, in whole or in part, to the final price of the fuel.

The logistics company will see its fuel costs increase. If Spain designs a compensation mechanism that includes companies (not just individuals), it could receive partial compensation. If the mechanism is limited to domestic consumers, the company will assume the full additional cost. Knowing the design of the Spanish national mechanism will be critical for planning costs from 2027.

What should companies do now?

1. Identify the level of exposure: quantify how much your company spends on petrol, diesel and natural gas per year. That is the scope on which ETS2 will have an impact from 2027.
2. Follow the development of the Spanish national mechanism: Spain must define how it will pass compensation on to end consumers. Monitor publications from the Ministry for Ecological Transition and the Official State Gazette to find out if your company can benefit from compensation.
3. If you are a distributor or trader: start now the analysis of new reporting obligations and delivery of emission allowances. You will need systems to track emissions associated with the fuel you market.
4. Model the impact on 2027 budgets: incorporate into your financial planning a scenario with additional CO2 costs on fuels. Although the exact price of allowances will depend on the market, you can use ETS1 references as a starting point.
5. Review contracts with fuel suppliers: analyse whether your current supply contracts include price revision clauses for regulatory changes. ETS2 may trigger renegotiations.
6. Consult with a specialist advisor in environmental and energy regulations to define your compliance and cost optimization strategy before 2027.

Official source

Consult the complete regulation at the official source

Disclaimer: This article is for informational purposes only and does not constitute legal advice. For specific decisions, please consult a qualified professional. Source: https://eur-lex.europa.eu/./legal-content/AUTO/?uri=OJ:L_202602467