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Fit for 55: reducing emissions from transport, buildings, agriculture and waste

The EU has set itself the goal of reaching climate neutrality by 2050 and of cutting net greenhouse gas emissions by at least 55% compared to 1990 levels by 2030.

One of the elements that will contribute to those goals is the revision of the effort sharing regulation (ESR), which updates the member states’ current emissions reduction targets for 2030 in sectors such as the transport, buildings, agriculture and waste sectors.

The Council has reached a general approach on the Commission’s proposal for the revised regulation in June 2022. A provisional deal was reached with the European Parliament in November 2022. 

The Council formally adopted the revised effort sharing regulation in March 2023.

The infographic presents figures and data related to new proposed rules which aim to reduce greenhouse gas emissions in key economic sectors.

Revision of the effort sharing regulation explained

The effort sharing regulation (ESR) sets a target for each member state to cut greenhouse gas emissions in a number of economic sectors, which currently represent around 60% of total EU emissions. The EU is revising this regulation to align with its new ambitious climate goals. 

Which sectors are covered?

  • Road transport
  • Buildings
  • Agriculture
  • Waste
  • Small industries

These sectors are not covered by the current EU emissions trading system (EU ETS), which covers large installations, power plants and commercial aviation (a revision of the ETS proposed as part of the Fit for 55 package extends the scope of the ETS to maritime transport).

Under Fit for 55, a new emissions trading system is proposed for the buildings and road transport sectors which will be covered under both the effort sharing regulation and the new ETS.

What are the new rules about?

With the updated rules, the EU aims to reduce greenhouse gas emissions in the ESR sectors by 40% by 2030.

Existing 2030 target: 29% reduction

New 2030 target: 40% reduction
(compared to 2005 levels)

National targets

  • Each member state contributes to the reduction of emissions in these sectors.
  • The proposed regulation sets new and binding 2030 targets for each member state, and it defines annual national emissions limits that lead progressively to those national 2030 targets.
  • The targets are set in a fair and cost-effective manner that takes into account national circumstances
  • The national emissions trajectories for each member state may be adjusted in 2025 if this is considered necessary in light of the impacts of COVID-19 or other unforeseen events on emissions.

Flexibilities to help member states reach their targets

  • Banking: if a country emits less than its annual limit, it can use part of the surplus for the following year
  • Borrowing: if a country emits more than its annual allocation, it can borrow from the following year’s allocation
  • Trade: countries can buy and sell excess allocations among themselves

Also:

  • Emissions trading system: some countries may use a limited amount of allowances from the EU ETS to reach ESR targets
  • Land use and forestry regulation: a limited quantity of credits from carbon removals under the LULUCF regulation on land use and forestry may be used to reach ESR targets

How does the new regulation contribute to the green transition?

  • Reducing the carbon emissions of key economic sectors
  • Distributing the burden among member states in a fair and cost-effective way

The efforts sharing regulation is closely interlinked with:

  • EU emissions trading system (EU ETS)
  • Land use and forestry regulation (LULUCF)
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Last review: 31 January 2025