France's veto of a proposed second carbon market postpones new decarbonization revenue streams
Executive summary: In May 2025 four French ministers sent a letter to the Élysée and Matignon urging the implementation of a second carbon market to generate rapid revenue for decarbonization; President Emmanuel Macron and Prime Minister François Bayrou rejected the request. The veto postpones a potential new source of funding for France’s climate goals, leaving the existing EU ETS as the sole carbon pricing tool and creating uncertainty for investors in low‑carbon technologies.
Who is involved: Key actors: President Emmanuel Macron, Prime Minister François Bayrou, the four unnamed ministers who authored the letter, and the Élysée/Matignon administrations.
Likely next: The French government may revisit the carbon‑market proposal after the 2027 presidential election or as part of future budget negotiations, depending on political and fiscal pressures.
In May 2025 four French ministers urged the Élysée and Matignon to launch a second carbon market to raise funds for decarbonization, but President Emmanuel Macron and Prime Minister François Bayrou rejected the request, as revealed by Politico. The decision leaves the existing EU Emissions Trading System as the sole carbon pricing mechanism in France, delaying potential fiscal resources for climate initiatives. The move reflects ongoing tensions within the French government over the speed and financing of the ecological transition.
Timeline
- — Extension du marché carbone : le jour où Macron et Bayrou ont dit non à quatre ministres (Politico Europe)
Key entities
Sources
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