### 226. calls on the commission to keep parliament informed in a timely manner about the evolution of the files in czech republic and in slovakia; ### 226. calls on the commission to continue keeping parliament informed in a timely manner about the evolution of the files in czech republic and in slovakia;


### 233. calls on the commission to set up a mechanism ensuring that the farmers will be given the opportunity to lodge a complaint with the commission in case of land grabbing; ### 233. calls on the commission to set up a mechanism ensuring that the farmer/beneficiaries will be given the opportunity to lodge a complaint with the commission in case of land grabbing including adequate protection mechanisms;


### 236. regrets that , as to the support to young farmers via rural development schemes , the court concluded in its special report 10/2017 that the measures are generally based on a vague needs assessment and that there is no real coordination between pillar i payments with pillar 2 support to young farmers; ### 236. regrets that , as to the support to young farmers via rural development schemes , the court concluded in its special report 10/2017 that the measures are generally based on a vague needs assessment and that there is no real coordination between pillar i payments with pillar ii support to young farmers;


### 241. notes that the court considered that the number of audited transactions in 2018 was not sufficient to estimate the level of error and that it took this decision following its general strategy to reduce its substantive testing and partially rely on the so-called “work of others”; ### 241. notes that the court considered that the number of audited transactions in 2018 was not sufficient to estimate the level of error and that it took this decision following its general strategy to reduce its substantive testing and partially rely on the so-called “work of others”; proposes the court to increase the number of audited transactions in order to provide an estimated level of error for the chapter global europe;


### 250. points out that pooling resources from the edf , the union budget and other donors in trust funds should not have as consequence that money flagged for the development and cooperation policy do not reach their normal beneficiaries; ### 250. points out that pooling resources from the edf , the union budget and other donors in trust funds should not have as a consequence that money flagged for the development and cooperation policy do not reach their intended beneficiaries;


### 251. notes that if in order to lead a more efficient development cooperation policy it may happen that the commission uses union funds for security purposes; the funded actions should have a proper legal basis and be lead in full transparency; ### 251. notes that commission may use union funds for security purposes in order to reach a more efficient development cooperation; a proper legal basis and the full transparency of the funded actions must be secured;


### 262. calls on the commission to exclude ngos applicants that present wrongful declarations of previous experience errors and to check them more thoroughly; ### 262. calls on the commission to exclude ngos or any other applicants that repeatedly or intentionally present wrongful declarations of previous experience errors and to check them more thoroughly;


### 263. requests the commission to ensure that the same sub-granting procedures is used and systematically applied by its services; ### 263. requests the commission to ensure that the same sub-granting procedure is used and systematically applied by its services;


### 268. points out that the public and political interest in this area is far much higher than its financial share; ### 268. points out that the public and political interest in this area is far higher than its financial share; calls on the court to consider auditing additional transactions and provide an estimated level of error for the chapter security and citizenship;


### 289. is concerned that the court detected a greater number of internal control weaknesses than in previous years in the management of family allowances for staff members and regretted that the pmo did not sufficiently monitor the accurate and timely updating of personal files to ensure that the basis used to calculated salaries and allowances is correct; ### 289. is deeply concerned that the court detected a greater number of internal control weaknesses than in previous years in the management of family allowances for staff members and regretted that the pmo did not sufficiently monitor the accurate and timely updating of personal files to ensure that the basis used to calculated salaries and allowances is correct;


### 297. notes that in accordance with the financial regulation of the european schools , the court has reviewed the schools’ consolidated annual accounts for the 2018 financial year , the accounts of the central office and the internal control systems (recruitment , procurement and payments) of two of the schools (bergen and varese; notes that the court has reviewed the work of the schools’ external auditor , which examined the accounts and internal control systems of seven schools before consolidation took place; ### 297. notes that in accordance with the financial regulation of the european schools , the court has reviewed the schools’ consolidated annual accounts for the 2018 financial year , the accounts of the central office and the internal control systems (recruitment , procurement and payments) of two of the schools (bergen and varese); notes that the court has reviewed the work of the schools’ external auditor , which examined the accounts and internal control systems of seven schools before consolidation took place;


### 312. calls for simplification wherever possible , for example through the greater use of lump sums as an option for beneficiaries and greater acceptance of usual accounting practices , as well as through the implemen tation of a single audit approach; stresses that the majority of union subsidies should benefit the citizens and that smes and farms should benefit the most; stresses that errors made in the current programming period 2014 to 2020 need to be improved in the new mff , especially in the area of regional development and cohesion; ### 312. calls for simplification wherever possible , for example by making greater use of lump sums as an option for beneficiaries and by adopting usual accounting practices , as well as through the implementation of a single audit approach; highlights that the majority of union subsidies should benefit the citizens and that smes and farms should benefit the most; highlights also that errors made in the current programming period 2014 to 2020 need to be improved in the new mff , especially in the area of regional development and cohesion;


### 312. calls for simplification wherever possible , for example through the greater use of lump sums as an option for beneficiaries and greater acceptance of usual accounting practices , as well as through the implemen tation of a single audit approach; stresses that the majority of union subsidies should benefit the citizens and that smes and farms should benefit the most; stresses that errors made in the current programming period 2014 to 2020 need to be improved in the new mff , especially in the area of regional development and cohesion; ### 312. calls for simplification wherever possible , for example through the greater use of lump sums as an option for beneficiaries and greater acceptance of usual accounting practices , as well as through the implementation of a single audit approach; stresses that the majority of union subsidies should benefit the citizens and that smes and family-owned or small and medium-sized farms should benefit the most; stresses that errors made in the current programming period 2014 to 2020 need to be improved in the new mff , especially in the area of regional development and cohesion;


### 327. stresses that controls to prevent the misuse of union financing must be intensified in line with proportionality; where the court identifies serious weaknesses in the quality and reliability of the national audit authorities , union controls need to be strengthened; stresses that , should the court determine a total failure of the national audit authorities , the mff for the programming period 2021 to 2027 should provide mechanisms for the commission to manage the allocation of funds; ### 327. stresses that controls to prevent the misuse of union funds must be intensified in line with proportionality; where the court identifies serious weaknesses in the quality and reliability of the national audit authorities , union controls need to be strengthened; points out that the court should identify a total failure of the national audit authorities , the mff for the programming period 2021 to 2027 and should provide mechanisms for the commission to manage the allocation of funds;


### 7. stresses that support to young farmers from the cap is essential; encourages the commission to move towards a greener cap in line with the paris agreement. ### 7. stresses that support from the cap to young farmers and new farmers is essential; insists that better access to financing for investing in the latest digitisation and digitisation technologies be ensured; encourages the commission to move towards a greener cap , in line with the paris agreement , which is applicable to all parts of the food supply chain , and to avoid imposing any additional burdens.


### 1. welcomes the finding of the court of auditors that the transactions underlying the accounts of the european maritime safety agency ('the agency') for the 2018 financial year are legal and regular in all material respects; ### 1. notes the finding of the court of auditors that the transactions underlying the accounts of the european maritime safety agency ('the agency') for the 2018 financial year are legal and regular in all material respects;


### 1. grants the executive director of the european maritime safety agency discharge in respect of the implementation of the agency’s budget for the financial year 2018/ postpones its decision on granting the executive director of the european maritime safety agency discharge in respect of the implementation of the agency’s budget for the financial year 2018; ### 1. grants the executive director of the european maritime safety agency discharge in respect of the implementation of the agency’s budget for the financial year 2018;


### 1. approves the closure of the accounts of the european maritime safety agency for the financial year 2018/ postpones the closure of the accounts of the european maritime safety agency for the financial year 2018; ### 1. approves the closure of the accounts of the european maritime safety agency for the financial year 2018;


### 4. notes that the agency cooperates with the european fisheries control agency and the european border and coast guard agency for what concerns the european coastguard function; ### 4. notes that the agency cooperates with the european fisheries control agency and the european border and coast guard agency for what concerns the european coastguard function; further strongly encourages the agency to seek further and broader cooperation with all of the union agencies;


### 6. notes that , on 31 december 2018 , the establishment plan was 97 ,21 % filled , with 210 officials and temporary agents (tas) appointed out of 212 officials and tas authorised under the union budget (212 authorised posts in 2017); notes that in addition 30 contract agents and 17 seconded national experts have been working for the agency in 2018; ### 6. notes that , on 31 december 2018 , the establishment plan was 97 ,21 % filled , with 210 officials and temporary agents (tas) appointed out of 212 officials and tas authorised under the union budget (212 authorised posts in 2017); notes that in addition 30 contract agents and 17 seconded national experts have been working for the agency in 2018; notes that , on 31 december 2018 , the establishment plan was 97 ,21 % filled , with 209 officials and temporary agents (tas) appointed out of 215 officials and tas authorised under the union budget (212 authorised posts in 2017); notes that in addition 30 contract agents and 17 seconded national experts have been working for the agency in 2018; encourages the agency to perform a research on the topic of sharing staff among other union agencies , with a special emphasis on possibilities of further connection of administrative staff with other lisbon-based agencies , namely the european monitoring centre for drugs and drug addiction;


### 1. welcomes the finding of the court of auditors that the accounts of the european aviation safety agency ('the agency') for the 2018 financial year are legal and regular in all material respects; ### 1. notes the finding of the court of auditors that the accounts of the european aviation safety agency ('the agency') for the 2018 financial year are legal and regular in all material respects;


### 1. grants the executive director of the european union aviation safety agency discharge in respect of the implementation of the agency’s budget for the financial year 2018/ postpones its decision on granting the executive director of the european union aviation safety agency discharge in respect of the implementation of the agency’s budget for the financial year 2018; ### 1. grants the executive director of the european union aviation safety agency discharge in respect of the implementation of the agency’s budget for the financial year 2018;


### 1. approves the closure of the accounts of the european union aviation safety agency for the financial year 2018/ postpones the closure of the accounts of the european union aviation safety agency for the financial year 2018; ### 1. approves the closure of the accounts of the european union aviation safety agency for the financial year 2018;


### 4. notes that the agency ended the year with an overall deficit of 2 million eur (a surplus of 0 ,7 million eur related to subsidy activities and a deficit of 2 ,7 million eur related to fees and charges activities); notes that the fees and charges deficit is deducted from the accumulated surplus , reducing it from 54 ,9 million eur to 52 ,2 million eur; observes that concerning activities related to fees and charges , the income rose by 1 ,8 million eur compared to 2017 , however staff costs increased by 3 ,7 million eur , administrative costs by 0 ,9 million eur and operational costs by 2 ,6 million eur; notes that for subsidy-related activities an increase of subsidy by 2 million eur was enough to cover the rise in administrative costs by 0 ,1 million eur and operational expenditures by 1 ,4 million eur; ### 4. notes that the agency ended the year with an overall deficit of 2 million eur (a surplus of 0 ,7 million eur related to subsidy activities and a deficit of 2 ,7 million eur related to fees and charges activities); notes that the fees and charges deficit is deducted from the accumulated surplus , reducing it from 54 ,9 million eur to 52 ,2 million eur; observes that concerning activities related to fees and charges , the income rose by 1 ,8 million eur compared to 2017 , however staff costs increased by 3 ,7 million eur , administrative costs by 0 ,9 million eur and operational costs by 2 ,6 million eur; notes that for subsidy-related activities an increase of subsidy by 2 million eur was enough to cover the rise in administrative costs by 0 ,1 million eur and operational expenditures by 1 ,4 million eur; stresses that the accumulation of the eur 52.2 million surplus stemming from aviation-funded activities is not provided for by the founding regulation and that corrective actions have not been completed as from fy2016;


### 4. notes that the agency shares resources on overlapping tasks with other agencies , including notably the european food safety agency , the european training foundation , the european securities market authority , in the areas of surveys , e-learning , cloud and linkedin services and environment awareness training; ### 4. notes with appreciation that the agency shares resources on overlapping tasks with other agencies , including notably the european food safety agency , the european training foundation , the european securities market authority , in the areas of surveys , e-learning , cloud and linkedin services and environment awareness training; strongly encourages the agency to actively keep seeking further and broader cooperation with all of the union agencies;


### 8. notes from the court’s report that , for the procurement of data analytics services for a volume of up to 5 000 000 eur , the agency chose to use a framework contract with a single operator resulting from an open procedure published in the official journal of the union; notes , however , that the terms used in the framework contract were not specific enough to allow a fair competition , because the requirements were not yet known at the time of the procurements procedure; recalls that , according to the financial regulation , in such circumstances , the contracting authority has to award a framework contract to multiple operators and a competitive procedure between the selected contractors has to be used for the specific purchases; takes notes on the agency’s reply that it chose a single framework contract rather than a multiple framework contract which would have resulted in a change of contractor during the lifetime of the framework contract and would have had severe consequences in terms of coherence and timely completion; calls on the agency to design framework contracts which allow fair competition and ensure value for money; ### 8. notes with concern from the court’s report that , for the procurement of data analytics services for a volume of up to 5 000 000 eur , the agency chose to use a framework contract with a single operator resulting from an open procedure published in the official journal of the union; notes , however , that the terms used in the framework contract were not specific enough to allow a fair competition , because the requirements were not yet known at the time of the procurements procedure; recalls that , according to the financial regulation , in such circumstances , the contracting authority has to award a framework contract to multiple operators and a competitive procedure between the selected contractors has to be used for the specific purchases; takes notes on the agency’s reply that it chose a single framework contract rather than a multiple framework contract which would have resulted in a change of contractor during the lifetime of the framework contract and would have had severe consequences in terms of coherence and timely completion; calls on the agency to design framework contracts which allow fair competition and ensure value for money;


### 10. notes , in light of comments and observations from the discharge authority related the use of some of the tools launched by the commission aimed to introduce a single solution for the electronic exchange of information with third parties participating in public procurement procedures (e-procurement) , that the agency provides since january 2018 the possibility for all suppliers to electronically submit electronic invoices; notes , moreover , that by the end of 2018 more than 80% of invoices have been received electronically; however , notes that the processing of electronically received invoices and the encoding of the invoice data is done manually due to the fact that this is considered to be the most reasonable solution; ### 10. notes , in light of comments and observations from the discharge authority related the use of some of the tools launched by the commission aimed to introduce a single solution for the electronic exchange of information with third parties participating in public procurement procedures (e-procurement) , that the agency provides since january 2018 the possibility for all suppliers to electronically submit electronic invoices; welcomes , moreover , that by the end of 2018 more than 80% of invoices have been received electronically; however , notes that the processing of electronically received invoices and the encoding of the invoice data is done manually due to the fact that this is considered to be the most reasonable solution;


### 16. notes that under the dg move delegation agreement , the joint undertaking launched in january 2018 an open call for proposals for studies and demonstrations on drone traffic management in europe (u-space call) , the maximum grant amount of eur 9 500 000 being funded through the commission’s cef fund; notes the court’s findings that whilst the award criteria of the call respected in general the orientations laid down in the cef regulation , the court observed several overlaps and inconsistences among award criteria and their sub-criteria , which may put at risk the overall effectiveness of the grant evaluation process and needs to be addressed at the call design and preparation phase; ### 16. notes that under the dg move delegation agreement , the joint undertaking launched in january 2018 an open call for proposals for studies and demonstrations on drone traffic management in europe (u-space call) , the maximum grant amount of eur 9 500 000 being funded through the commission’s cef fund; notes with grave concern the court’s findings that whilst the award criteria of the call respected in general the orientations laid down in the cef regulation , the court observed several overlaps and inconsistences among award criteria and their sub-criteria , which may put at risk the overall effectiveness of the grant evaluation process and needs to be addressed at the call design and preparation phase;


### 23. notes with concern the court’s findings that a majority of the projects audited would have been financed without union funding support , there were weaknesses in the implementation of the funding scheme , in particular , insufficient prioritisation , and air traffic management performance benefits in an operational environment are still to be demonstrated; ### 23. notes with concern the court’s findings that a majority of the projects audited would have been financed without union funding support; expresses wonder about the utility of such large-scale union funding; further notes there were weaknesses in the implementation of the funding scheme , in particular , insufficient prioritisation; highlights the fact that air traffic management performance benefits in an operational environment are still to be demonstrated;


### 6. acknowledges the fact that out of eur 350 000 000 of contributions to be made by the industry members to the operational activities and administrative costs of the joint undertaking , by the end of 2018 , i.e. four months after the joint undertaking had launched its first horizon 2020 projects , the industry members had reported in-kind contributions of eur 63 700 000 for operational activities , of which eur 21 700 000 had been certified; moreover , notes that out of eur 120 000 000 of contributions to be made by the industry members to additional activities of the joint undertaking , the industry members had reported in cash contributions of eur 6 500 000 for other activities outside of the joint undertaking’s work plan; ### 6. welcomes the fact that out of eur 350 000 000 of contributions to be made by the industry members to the operational activities and administrative costs of the joint undertaking , by the end of 2018 , i.e. four months after the joint undertaking had launched its first horizon 2020 projects , the industry members had reported in-kind contributions of eur 63 700 000 for operational activities , of which eur 21 700 000 had been certified; moreover , notes that out of eur 120 000 000 of contributions to be made by the industry members to additional activities of the joint undertaking , the industry members had reported in cash contributions of eur 6 500 000 for other activities outside of the joint undertaking’s work plan;


### 18. acknowledge the fact that the internal audit service performs the role of internal auditor of the joint undertaking and , in this respect , it reports to the governing board and the executive director indirectly; notes that the first audit mission established a risk profile of the joint undertaking with the objective to establish a triennial internal audit plan; observes that the internal audit service strategic internal audit plan 2017-2019 has been presented in june 2017; moreover , in accordance with this audit plan , the ias performed in 2018 a limited review of the implementation of internal control standards; observes that from the 5 recommendations to management to address the shortcomings identified that were not yet fully implemented , only one still required implementing actions in 2019; ### 18. acknowledge the fact that the internal audit service performs the role of internal auditor of the joint undertaking and , in this respect , it reports to the governing board and the executive director indirectly; notes that the first audit mission established a risk profile of the joint undertaking with the objective to establish a triennial internal audit plan; observes that the internal audit service strategic internal audit plan 2017-2019 has been presented in june 2017; moreover , in accordance with this audit plan , the ias performed in 2018 a limited review of the implementation of internal control standards; observes with appreciation that from the 5 recommendations to management to address the shortcomings identified that were not yet fully implemented , only one still required implementing actions in 2019;


### (28) achieving the increased climate ambition will require substantial public resources in the eu as well as national budgets to be dedicated to the climate transition. to complement and reinforce the substantial climate-related spending in the eu budget , all auction revenues that are not attributed to the union budget should be used for climate-related purposes. this includes the use for financial support to address social aspects in lower- and middle-income households by reducing distortive taxes. further , to address distributional and social effects of the transition in low-income member states , an additional amount of 2 ,5 % of the union-wide quantity of allowances from [year of entry into force of the directive] to 2030 should be used to fund the energy transition of the member states with a gross domestic product (gdp) per capita below 65 % of the union average in 2016-2018 , through the modernisation fund referred to in article 10d of directive 2003/87/ec. ### (28) achieving the increased climate ambition will require substantial public and private resources in the eu as well as national budgets to be dedicated to the climate transition. to complement and reinforce the substantial climate-related spending in the eu budget , all auction revenues that are not attributed to the union budget in the form of own resources should be used for climate-related purposes. this includes the use for financial support to address social aspects in lower- and middle-income households by reducing distortive taxes. further , to address distributional and social effects of the transition in low-income member states , an additional amount of 2 ,5 % of the union-wide quantity of allowances from [year of entry into force of the directive] to 2030 should be used to fund the energy transition of the member states with a gross domestic product (gdp) per capita below 65 % of the union average in 2016-2018 , through the modernisation fund referred to in article 10d of directive 2003/87/ec.


### (47) the regulated entities falling within the scope of the emissions trading in the sectors of buildings and road transport should be subject to similar greenhouse gas emissions permit requirements as the operators of stationary installations. it is necessary to establish rules on permit applications , conditions for permit issuance , content , and review , and any changes related to the regulated entity. in order for the new system to start in an orderly manner , member states should ensure that regulated entities falling within the scope of the new emissions trading have a valid permit as of the start of the system in 2025. ### (47) the regulated entities falling within the scope of the emissions trading in the sector of buildings should be subject to similar greenhouse gas emissions permit requirements as the operators of stationary installations. it is necessary to establish rules on permit applications , conditions for permit issuance , content , and review , and any changes related to the regulated entity. in order for the new system to start in an orderly manner , member states should ensure that regulated entities falling within the scope of the new emissions trading have a valid permit as of the start of the system in 2025.


### (48) the total quantity of allowances for the new emissions trading should follow a linear trajectory to reach the 2030 emissions reduction target , taking into account the cost-efficient contribution of buildings and road transport of 43 % emission reductions by 2030 compared to 2005. the total quantity of allowances should be established for the first time in 2026 , to follow a trajectory starting in 2024 from the value of the 2024 emissions limits (1 109 304 000 co2t) , calculated in accordance with article 4(2) of regulation (eu) 2018/842 of the european parliament and of the council59 on the basis of the reference emissions for these sectors for the period from 2016 to 2018. accordingly , the linear reduction factor should be set at 5 ,15 %. from 2028 , the total quantity of allowances should be set on the basis of the average reported emissions for the years 2024 , 2025 and 2026 , and should decrease by the same absolute annual reduction as set from 2024 , which corresponds to a 5 ,43 % linear reduction factor compared to the comparable 2025 value of the above defined trajectory. if those emissions are significantly higher than this trajectory value and if this divergence is not due to small-scale differences in emission measurement methodologies , the linear reduction factor should be adjusted to reach the required emissions reduction in 2030. ### (48) the total quantity of allowances for the new emissions trading should follow a linear trajectory to reach the 2030 emissions reduction target and by latest the 2050 climate neutrality target , taking into account the cost-efficient contribution of buildings and road transport of 43 % emission reductions by 2030 compared to 2005. the total quantity of allowances should be established for the first time in 2026 , to follow a trajectory starting in 2024 from the value of the 2024 emissions limits (1 109 304 000 co2t) , calculated in accordance with article 4(2) of regulation (eu) 2018/842 of the european parliament and of the council59 on the basis of the reference emissions for these sectors for the period from 2016 to 2018. accordingly , the linear reduction factor should be set at 5 ,15 %. from 2028 , the total quantity of allowances should be set on the basis of the average reported emissions for the years 2024 , 2025 and 2026 , and should decrease by the same absolute annual reduction as set from 2024 , which corresponds to a 5 ,43 % linear reduction factor compared to the comparable 2025 value of the above defined trajectory. if those emissions are significantly higher than this trajectory value and if this divergence is not due to small-scale differences in emission measurement methodologies , the linear reduction factor should be adjusted to reach the required emissions reduction in 2030.


### (48) the total quantity of allowances for the new emissions trading should follow a linear trajectory to reach the 2030 emissions reduction target , taking into account the cost-efficient contribution of buildings and road transport of 43 % emission reductions by 2030 compared to 2005. the total quantity of allowances should be established for the first time in 2026 , to follow a trajectory starting in 2024 from the value of the 2024 emissions limits (1 109 304 000 co2t) , calculated in accordance with article 4(2) of regulation (eu) 2018/842 of the european parliament and of the council59 on the basis of the reference emissions for these sectors for the period from 2016 to 2018. accordingly , the linear reduction factor should be set at 5 ,15 %. from 2028 , the total quantity of allowances should be set on the basis of the average reported emissions for the years 2024 , 2025 and 2026 , and should decrease by the same absolute annual reduction as set from 2024 , which corresponds to a 5 ,43 % linear reduction factor compared to the comparable 2025 value of the above defined trajectory. if those emissions are significantly higher than this trajectory value and if this divergence is not due to small-scale differences in emission measurement methodologies , the linear reduction factor should be adjusted to reach the required emissions reduction in 2030. ### (48) the total quantity of allowances for the new emissions trading should follow a linear trajectory to reach the 2030 emissions reduction target , taking into account the cost-efficient contribution of buildings of necessary emission reductions by 2030 compared to 2005 provided by regulation (eu) 2021/1119. the total quantity of allowances should be established for the first time in 2026 , to follow a trajectory starting in 2024 from the value of the 2024 emissions limits (1 109 304 000 co2t) , calculated in accordance with article 4(2) of regulation (eu) 2018/842 of the european parliament and of the council59 on the basis of the reference emissions for these sectors for the period from 2016 to 2018. accordingly , the linear reduction factor should be set at 5 ,15 %. from 2028 , the total quantity of allowances should be set on the basis of the average reported emissions for the years 2024 , 2025 and 2026 , and should decrease by the same absolute annual reduction as set from 2024 , which corresponds to a 5 ,43 % linear reduction factor compared to the comparable 2025 value of the above defined trajectory. if those emissions are significantly higher than this trajectory value and if this divergence is not due to small-scale differences in emission measurement methodologies , the linear reduction factor should be adjusted to reach the required emissions reduction in 2030.


### (49) the auctioning of allowances is the simplest and the most economically efficient method for allocating emission allowances , which also avoids windfall profits. both the buildings and road transport sectors are under relatively small or non-existent competitive pressure from outside the union and are not exposed to a risk of carbon leakage. therefore , allowances for buildings and road transport should only be allocated via auctioning without there being any free allocation. ### (49) the auctioning of allowances is the simplest and the most economically efficient method for allocating emission allowances , which is a clear indicator of the current price of coal , and which also avoids windfall profits. both the buildings and road transport sectors are under relatively small or non-existent competitive pressure from outside the union and are not exposed to a risk of carbon leakage. therefore , allowances for buildings and road transport should only be allocated via auctioning without there being any free allocation.


### (49) the auctioning of allowances is the simplest and the most economically efficient method for allocating emission allowances , which also avoids windfall profits. both the buildings and road transport sectors are under relatively small or non-existent competitive pressure from outside the union and are not exposed to a risk of carbon leakage. therefore , allowances for buildings and road transport should only be allocated via auctioning without there being any free allocation. ### (49) the auctioning of allowances is the simplest and the most economically efficient method for allocating emission allowances , which also avoids windfall profits. the sector of buildings is under relatively small or non-existent competitive pressure from outside the union and is not exposed to a risk of carbon leakage. therefore , allowances for buildings should only be allocated via auctioning without there being any free allocation.


### (50) in order to ensure a smooth start to emissions trading in the buildings and road transport sectors and taking into account the need of the regulated entities to hedge or buy ahead allowances to mitigate their price and liquidity risk , a higher amount of allowances should be auctioned early on. in 2026 , the auction volumes should therefore be 30 % higher than the total quantity of allowances for 2026. this amount would be sufficient to provide liquidity , both if emissions decrease in line with reduction needs , and in the event emission reductions only materialise progressively. the detailed rules for this front-loading of auction volume are to be established in a delegated act related to auctioning , adopted pursuant to article 10(4) of directive 2003/87/ec. ### (50) in order to ensure a smooth start to emissions trading in the buildings sector and taking into account the need of the regulated entities to hedge or buy ahead allowances to mitigate their price and liquidity risk , a higher amount of allowances should be auctioned early on. in 2026 , the auction volumes should therefore be 30 % higher than the total quantity of allowances for 2026. this amount would be sufficient to provide liquidity , both if emissions decrease in line with reduction needs , and in the event emission reductions only materialise progressively. the detailed rules for this front-loading of auction volume are to be established in a delegated act related to auctioning , adopted pursuant to article 10(4) of directive 2003/87/ec.


### (51) the distribution rules on auction shares are highly relevant for any auction revenues that would accrue to the member states , especially in view of the need to strengthen the ability of the member states to address the social impacts of a carbon price signal in the buildings and road transport sectors. notwithstanding the fact that the two sectors have very different characteristics , it is appropriate to set a common distribution rule similar to the one applicable to stationary installations. the main part of allowances should be distributed among all member states on the basis of the average distribution of the emissions in the sectors covered during the period from 2016 to 2018. ### (51) the distribution rules on auction shares are highly relevant for any auction revenues that would accrue to the member states , especially in view of the need to strengthen the ability of the member states to address the social impacts of a carbon price signal in the buildings and road transport sectors. notwithstanding the fact that the two sectors have very different characteristics , it is appropriate to set a common distribution rule similar to the one applicable to stationary installations. the main part of allowances should be distributed among all member states on the basis of the average distribution of the emissions in the sectors covered during the period from 2016 to 2018. the free allowances should be distributed among member states and regions based on transparent criteria , set by the commission via implementing acts , including existing levels of implementation of energy efficiency technologies in buildings , market shares of alternative mobility , affordability of energy efficiency technologies and alternative mobility , calculated as ratio between the price of existing technologies and national and regional median incomes.


### (51) the distribution rules on auction shares are highly relevant for any auction revenues that would accrue to the member states , especially in view of the need to strengthen the ability of the member states to address the social impacts of a carbon price signal in the buildings and road transport sectors. notwithstanding the fact that the two sectors have very different characteristics , it is appropriate to set a common distribution rule similar to the one applicable to stationary installations. the main part of allowances should be distributed among all member states on the basis of the average distribution of the emissions in the sectors covered during the period from 2016 to 2018. ### (51) the distribution rules on auction shares are highly relevant for any auction revenues that would accrue to the member states , especially in view of the need to strengthen the ability of the member states to address the social impacts of a carbon price signal in the buildings sector. it is appropriate to take into account the characteristics of the sector in order to elaborate a distribution rule similar to the one applicable to stationary installations. the main part of allowances should be distributed among all member states on the basis of the average distribution of the emissions in the sector covered during the period from 2016 to 2018.


### (52) the introduction of the carbon price in road transport and buildings should be accompanied by effective social compensation , especially in view of the already existing levels of energy poverty. about 34 million europeans reported an inability to keep their homes adequately warm in 2018 , and 6 ,9 % of the union population have said that they cannot afford to heat their home sufficiently in a 2019 eu-wide survey60 . to achieve an effective social and distributional compensation , member states should be required to spend the auction revenues on the climate and energy-related purposes already specified for the existing emissions trading , but also for measures added specifically to address related concerns for the new sectors of road transport and buildings , including related policy measures under directive 2012/27/eu of the european parliament and of the council61 . auction revenues should be used to address social aspects of the emission trading for the new sectors with a specific emphasis in vulnerable households , micro-enterprises and transport users. in this spirit , a new social climate fund will provide dedicated funding to member states to support the european citizens most affected or at risk of energy or mobility poverty. this fund will promote fairness and solidarity between and within member states while mitigating the risk of energy and mobility poverty during the transition. it will build on and complement existing solidarity mechanisms. the resources of the new fund will in principle correspond to 25 % of the expected revenues from new emission trading in the period 2026-2032 , and will be implemented on the basis of the social climate plans that member states should put forward under regulation (eu) 20…/nn of the european parliament and the council62 . in addition , each member state should use their auction revenues inter alia to finance a part of the costs of their social climate plans. ### (52) the introduction of the carbon price in road transport and buildings should be accompanied by effective social compensation , especially in view of the already existing levels of energy poverty. about 34 million europeans reported an inability to keep their homes adequately warm in 2018 , and 6 ,9 % of the union population have said that they cannot afford to heat their home sufficiently in a 2019 eu-wide survey60 . to achieve an effective social and distributional compensation , member states should be required to spend the auction revenues on the climate and energy-related purposes already specified for the existing emissions trading , but also for measures added specifically to address related concerns for the new sectors of road transport and buildings , including related policy measures under directive 2012/27/eu of the european parliament and of the council61 . auction revenues should be used to address social aspects of the emission trading for the new sectors with a specific emphasis in vulnerable households , micro-enterprises and transport users. in this spirit , a new social climate fund will provide dedicated funding to member states to support the european citizens most affected or at risk of energy or mobility poverty. the social climate fund should be an integral part of the union budget in order to preserve the unity of the budget and the coherence with union policies , and to ensure that there is effective control by the budgetary authority , composed of the parliament and the council. this fund will promote fairness and solidarity between and within member states while mitigating the risk of energy and mobility poverty during the transition. it will build on and complement existing solidarity mechanisms. the resources of the new fund will be implemented on the basis of the social climate plans that member states should put forward under regulation (eu) 20…/nn of the european parliament and the council62 . the programmed baseline allocation in the eu budget should be increased annually by a supplementary reinforcement in case there is an increase in the carbon price , as it would raise the burden on the vulnerable households and traffic users. such annual reinforcements should be accommodated within the mff by means of an automatic ‘carbon price fluctuation adjustment’ of the ceiling of heading 3 and the payment ceiling , the mechanism for which is to be provided for in the mff regulation according to article 312 tfeu. in addition , each member state should use their auction revenues inter alia to finance a part of the costs of their social climate plans.


### (52) the introduction of the carbon price in road transport and buildings should be accompanied by effective social compensation , especially in view of the already existing levels of energy poverty. about 34 million europeans reported an inability to keep their homes adequately warm in 2018 , and 6 ,9 % of the union population have said that they cannot afford to heat their home sufficiently in a 2019 eu-wide survey60 . to achieve an effective social and distributional compensation , member states should be required to spend the auction revenues on the climate and energy-related purposes already specified for the existing emissions trading , but also for measures added specifically to address related concerns for the new sectors of road transport and buildings , including related policy measures under directive 2012/27/eu of the european parliament and of the council61 . auction revenues should be used to address social aspects of the emission trading for the new sectors with a specific emphasis in vulnerable households , micro-enterprises and transport users. in this spirit , a new social climate fund will provide dedicated funding to member states to support the european citizens most affected or at risk of energy or mobility poverty. this fund will promote fairness and solidarity between and within member states while mitigating the risk of energy and mobility poverty during the transition. it will build on and complement existing solidarity mechanisms. the resources of the new fund will in principle correspond to 25 % of the expected revenues from new emission trading in the period 2026-2032 , and will be implemented on the basis of the social climate plans that member states should put forward under regulation (eu) 20…/nn of the european parliament and the council62 . in addition , each member state should use their auction revenues inter alia to finance a part of the costs of their social climate plans. ### (52) the introduction of the carbon price in road transport and buildings should be accompanied by effective social compensation , especially in view of the already existing levels of energy poverty. about 34 million europeans reported an inability to keep their homes adequately warm in 2018 , and 6 ,9 % of the union population have said that they cannot afford to heat their home sufficiently in a 2019 eu-wide survey60 . to achieve an effective social and distributional compensation , member states should be required to spend the auction revenues on the climate and energy-related purposes already specified for the existing emissions trading , but also for measures added specifically to address related concerns for the new sectors of road transport and buildings , including related policy measures under directive 2012/27/eu of the european parliament and of the council61 . auction revenues should be used to address social aspects of the emission trading for the new sectors with a specific emphasis in vulnerable households , micro-enterprises and transport users. in this spirit , a new social climate fund will refinance member states' measures to support the european citizens most affected or at risk of energy or mobility poverty. this fund will promote fairness and solidarity between and within member states while mitigating the risk of energy and mobility poverty during the transition. it will build on and complement existing solidarity mechanisms. the resources of the new fund will in principle correspond to 25 % of the expected revenues from new emission trading in the period 2026-2032 , and will be implemented on the basis of the social climate plans that member states should put forward under regulation (eu) 20…/nn of the european parliament and the council62 . in addition , each member state should use their auction revenues inter alia to finance a part of the costs of their social climate plans.


### (52) the introduction of the carbon price in road transport and buildings should be accompanied by effective social compensation , especially in view of the already existing levels of energy poverty. about 34 million europeans reported an inability to keep their homes adequately warm in 2018 , and 6 ,9 % of the union population have said that they cannot afford to heat their home sufficiently in a 2019 eu-wide survey60 . to achieve an effective social and distributional compensation , member states should be required to spend the auction revenues on the climate and energy-related purposes already specified for the existing emissions trading , but also for measures added specifically to address related concerns for the new sectors of road transport and buildings , including related policy measures under directive 2012/27/eu of the european parliament and of the council61 . auction revenues should be used to address social aspects of the emission trading for the new sectors with a specific emphasis in vulnerable households , micro-enterprises and transport users. in this spirit , a new social climate fund will provide dedicated funding to member states to support the european citizens most affected or at risk of energy or mobility poverty. this fund will promote fairness and solidarity between and within member states while mitigating the risk of energy and mobility poverty during the transition. it will build on and complement existing solidarity mechanisms. the resources of the new fund will in principle correspond to 25 % of the expected revenues from new emission trading in the period 2026-2032 , and will be implemented on the basis of the social climate plans that member states should put forward under regulation (eu) 20…/nn of the european parliament and the council62 . in addition , each member state should use their auction revenues inter alia to finance a part of the costs of their social climate plans. ### (52) the introduction of the carbon price in road transport and buildings should be preceded by effective targeted social investment in alternative solutions , especially in view of the already existing levels of energy poverty. about 34 million europeans reported an inability to keep their homes adequately warm in 2018 ,and 6 ,9 % of the union population have said that they cannot afford to heat their home sufficiently in a 2019 eu-wide survey. these vulnerable groups can not be expected to invest in energy efficiency and alternative mobility solutions , and without prior social investment , the new carbon pricing will only lead to further social exclusion of people living in energy and transport poverty and provoke a downward transition of low-middle-income groups into poverty. to achieve an effective social and distributional compensation , member states should be required to spend the auction revenues on the climate and energy-related purposes already specified for the existing emissions trading , but also for measures added specifically to address related concerns for the new sectors of road transport and buildings , including related policy measures under directive 2012/27/eu of the european parliament and of the council61.auction revenues should be used to address social aspects of the emission trading for the new sectors with a specific emphasis in vulnerable households , micro-enterprises and transport users. in this spirit , a new social climate fund will provide dedicated pre-emptive funding to member states to support the european citizens most affected or at risk of energy or mobility poverty. this fund will promote fairness and solidarity between and within member states while mitigating the risk of energy and mobility poverty during the transition. it will build on and complement existing solidarity mechanisms. the resources of the new fund will in principle correspond to 25 % of the expected revenues from the emission trading in the period 2026-2032 , and will be implemented on the basis of the social climate plans that member states should put forward under regulation (eu) 20…/nn of the european parliament and the council62 . in addition , each member state should use their auction revenues inter alia to finance a part of the costs of their social climate plans.


### (52) the introduction of the carbon price in road transport and buildings should be accompanied by effective social compensation , especially in view of the already existing levels of energy poverty. about 34 million europeans reported an inability to keep their homes adequately warm in 2018 , and 6 ,9 % of the union population have said that they cannot afford to heat their home sufficiently in a 2019 eu-wide survey60 . to achieve an effective social and distributional compensation , member states should be required to spend the auction revenues on the climate and energy-related purposes already specified for the existing emissions trading , but also for measures added specifically to address related concerns for the new sectors of road transport and buildings , including related policy measures under directive 2012/27/eu of the european parliament and of the council61 . auction revenues should be used to address social aspects of the emission trading for the new sectors with a specific emphasis in vulnerable households , micro-enterprises and transport users. in this spirit , a new social climate fund will provide dedicated funding to member states to support the european citizens most affected or at risk of energy or mobility poverty. this fund will promote fairness and solidarity between and within member states while mitigating the risk of energy and mobility poverty during the transition. it will build on and complement existing solidarity mechanisms. the resources of the new fund will in principle correspond to 25 % of the expected revenues from new emission trading in the period 2026-2032 , and will be implemented on the basis of the social climate plans that member states should put forward under regulation (eu) 20…/nn of the european parliament and the council62 . in addition , each member state should use their auction revenues inter alia to finance a part of the costs of their social climate plans. ### (52) the introduction of the carbon price in road transport and buildings should be accompanied by effective social compensation , especially in view of the already existing levels of energy poverty. about 34 million europeans reported an inability to keep their homes adequately warm in 2018 , and 6 ,9 % of the union population have said that they cannot afford to heat their home sufficiently in a 2019 eu-wide survey60 . to achieve an effective social and distributional compensation , member states should be required to spend the auction revenues on the climate and energy-related purposes already specified for the existing emissions trading , but also for measures added specifically to address related concerns for the new sectors of road transport and buildings , including related policy measures under directive 2012/27/eu of the european parliament and of the council61 . auction revenues should be used to address social and economic aspects of the emission trading for the new sectors with a specific emphasis in vulnerable households , micro-enterprises and transport users. in this spirit , a new social climate fund will provide dedicated funding to member states to support the european citizens most affected or at risk of energy or mobility poverty , as well as supporting enterprises greatly affected by this inclusion. this fund will promote fairness and solidarity between and within member states while mitigating the risk of energy and mobility poverty during the transition. it will build on and complement existing solidarity mechanisms. the resources of the new fund will in principle correspond to 25 % of the expected revenues from new emission trading in the period 2026-2032 , and will be implemented on the basis of the social climate plans that member states should put forward under regulation (eu) 20…/nn of the european parliament and the council62 . in addition , each member state should use their auction revenues inter alia to finance a part of the costs of their social climate plans.


### (52) the introduction of the carbon price in road transport and buildings should be accompanied by effective social compensation , especially in view of the already existing levels of energy poverty. about 34 million europeans reported an inability to keep their homes adequately warm in 2018 , and 6 ,9 % of the union population have said that they cannot afford to heat their home sufficiently in a 2019 eu-wide survey60. to achieve an effective social and distributional compensation , member states should be required to spend the auction revenues on the climate and energy-related purposes already specified for the existing emissions trading , but also for measures added specifically to address related concerns for the new sectors of road transport and buildings , including related policy measures under directive 2012/27/eu of the european parliament and of the council61. auction revenues should be used to address social aspects of the emission trading for the new sectors with a specific emphasis in vulnerable households , micro-enterprises and transport users. in this spirit , a new social climate fund will provide dedicated funding to member states to support the european citizens most affected or at risk of energy or mobility poverty. this fund will promote fairness and solidarity between and within member states while mitigating the risk of energy and mobility poverty during the transition. it will build on and complement existing solidarity mechanisms. the resources of the new fund will in principle correspond to 25 % of the expected revenues from new emission trading in the period 2026-2032 , and will be implemented on the basis of the social climate plans that member states should put forward under regulation (eu) 20…/nn of the european parliament and the council62. in addition , each member state should use their auction revenues inter alia to finance a part of the costs of their social climate plans. ### (52) the introduction of the carbon price in road transport and buildings should be accompanied by effective social compensation , especially in view of the already existing levels of energy poverty and the need to ensure accessible and sustainable mobility for all citizens of the union. about 34 million europeans reported an inability to keep their homes adequately warm in 2018 , and 6 ,9 % of the union population have said that they cannot afford to heat their home sufficiently in a 2019 eu-wide survey60. to achieve an effective social and distributional compensation , member states should be required to spend the auction revenues on the climate and energy-related purposes already specified for the existing emissions trading , but also for measures added specifically to address related concerns for the new sectors of road transport and buildings , including related policy measures under directive 2012/27/eu of the european parliament and of the council61. auction revenues should be used to address social aspects of the emission trading for the new sectors with a specific emphasis in vulnerable households , micro-enterprises and transport users. in this spirit , a new social climate fund will provide dedicated funding to member states to support the european citizens most affected or at risk of energy or mobility poverty. this fund will promote fairness and solidarity between and within member states while mitigating the risk of energy and mobility poverty during the transition. it will build on and complement existing solidarity mechanisms. the resources of the new fund will in principle correspond to 25 % of the expected revenues from new emission trading in the period 2026-2032 , and will be implemented on the basis of the social climate plans that member states should put forward under regulation (eu) 20…/nn of the european parliament and the council62. in addition , each member state should use their auction revenues inter alia to finance a part of the costs of their social climate plans.


### (52) the introduction of the carbon price in road transport and buildings should be accompanied by effective social compensation , especially in view of the already existing levels of energy poverty. about 34 million europeans reported an inability to keep their homes adequately warm in 2018 , and 6 ,9 % of the union population have said that they cannot afford to heat their home sufficiently in a 2019 eu-wide survey60 . to achieve an effective social and distributional compensation , member states should be required to spend the auction revenues on the climate and energy-related purposes already specified for the existing emissions trading , but also for measures added specifically to address related concerns for the new sectors of road transport and buildings , including related policy measures under directive 2012/27/eu of the european parliament and of the council61 . auction revenues should be used to address social aspects of the emission trading for the new sectors with a specific emphasis in vulnerable households , micro-enterprises and transport users. in this spirit , a new social climate fund will provide dedicated funding to member states to support the european citizens most affected or at risk of energy or mobility poverty. this fund will promote fairness and solidarity between and within member states while mitigating the risk of energy and mobility poverty during the transition. it will build on and complement existing solidarity mechanisms. the resources of the new fund will in principle correspond to 25 % of the expected revenues from new emission trading in the period 2026-2032 , and will be implemented on the basis of the social climate plans that member states should put forward under regulation (eu) 20…/nn of the european parliament and the council62 . in addition , each member state should use their auction revenues inter alia to finance a part of the costs of their social climate plans. ### (52) the introduction of the carbon price in the buildings sector should be accompanied by effective social compensation , especially in view of the already existing levels of energy poverty. about 34 million europeans reported an inability to keep their homes adequately warm in 2018 , and 6 ,9 % of the union population have said that they cannot afford to heat their home sufficiently in a 2019 eu-wide survey60 . to achieve an effective social and distributional compensation , member states should be required to spend the auction revenues on the climate and energy-related purposes already specified for the existing emissions trading , but also for measures added specifically to address related concerns for the new buildings sector , including related policy measures under directive 2012/27/eu of the european parliament and of the council61 . auction revenues should be used to address social aspects of the emission trading for the new sector with a specific emphasis in low and middle income households , smes and micro-enterprises. in this spirit , a new social climate fund will provide dedicated funding to member states to support the european citizens most affected or at risk of energy poverty. this fund will promote fairness and solidarity between and within member states while mitigating the risk of energy and mobility poverty during the transition. it will build on and complement existing solidarity mechanisms. the resources of the new fund will in principle correspond to 25 % of the expected revenues from new emission trading in the period 2026-2032 , and will be implemented on the basis of the social climate plans that member states should put forward under regulation (eu) 20…/nn of the european parliament and the council62 . in addition , each member state should use their auction revenues inter alia to finance a part of the costs of their social climate plans.


### (54) innovation and development of new low-carbon technologies in the sectors of buildings and road transport are crucial for ensuring the cost-efficient contribution of these sectors to the expected emission reductions. therefore , 150 million allowances from emissions trading in the buildings and road transport sectors should also be made available to the innovation fund to stimulate the cost-efficient emission reductions. ### (54) innovation and development of new low-carbon technologies in the sector of buildings is crucial for ensuring the cost-efficient contribution of these sectors to the expected emission reductions. therefore , [150] million allowances from emissions trading in the buildings sector should also be made available to the innovation fund to stimulate the cost-efficient emission reductions.


### (55) regulated entities covered by the buildings and road transport emissions trading should surrender allowances for their verified emissions corresponding to the quantities of fuels they have released for consumption. they should surrender allowances for the first time for their verified emissions in 2026. in order to minimise the administrative burden , a number of rules applicable to the existing emissions trading system for stationary installations and aviation should be made applicable to emissions trading for buildings and road transport , with the necessary adaptations. this includes , in particular , rules on transfer , surrender and cancellation of allowances , as well as the rules on the validity of allowances , penalties , competent authorities and reporting obligations of member states. ### (55) regulated entities covered by the buildings emissions trading should surrender allowances for their verified emissions corresponding to the quantities of fuels they have released for consumption. they should surrender allowances for the first time for their verified emissions in 2026. in order to minimise the administrative burden , a number of rules applicable to the existing emissions trading system for stationary installations and aviation should be made applicable to emissions trading for buildings , with the necessary adaptations. this includes , in particular , rules on transfer , surrender and cancellation of allowances , as well as the rules on the validity of allowances , penalties , competent authorities and reporting obligations of member states.


### (56) for emissions trading in the buildings and road transport sectors to be effective , it should be possible to monitor emissions with high certainty and at reasonable cost. emissions should be attributed to regulated entities on the basis of fuel quantities released for consumption and combined with an emission factor. regulated entities should be able to reliably and accurately identify and differentiate the sectors in which the fuels are released for consumption , as well as the final users of the fuels , in order to avoid undesirable effects , such as double burden. to have sufficient data to establish the total number of allowances for the period from 2028 to 2030 , the regulated entities holding a permit at the start of the system in 2025 should report their associated historical emissions for 2024. ### (56) for emissions trading in the buildings sector to be effective , it should be possible to monitor emissions with high certainty and at reasonable cost. emissions should be attributed to regulated entities on the basis of fuel quantities released for consumption and combined with an emission factor. regulated entities should be able to reliably and accurately identify and differentiate the sectors in which the fuels are released for consumption , as well as the final users of the fuels , in order to avoid undesirable effects , such as double burden. to have sufficient data to establish the total number of allowances for the period from 2028 to 2030 , the regulated entities holding a permit at the start of the system in 2025 should report their associated historical emissions for 2024.


### (57) it is appropriate to introduce measures to address the potential risk of excessive price increases , which , if particularly high at the start of the buildings and road transport emissions trading , may undermine the readiness of households and individuals to invest in reducing their greenhouse gas emissions. these measures should complement the safeguards provided by the market stability reserve established by decision (eu) 2015/1814 of the european parliament and of the council64 and that became operational in 2019. while the market will continue to determine the carbon price , safeguard measures will be triggered by rules-based automatism , whereby allowances will be released from the market stability reserve only if concrete triggering conditions based on the increase in the average allowance price are met. this additional mechanism should also be highly reactive , in order to address excessive volatility due to factors other than changed market fundamentals. the measures should be adapted to different levels of excessive price increase , which will result in different degrees of the intervention. the triggering conditions should be closely monitored by the commission and the measures should be adopted by the commission as a matter of urgency when the conditions are met. this is without prejudice to any accompanying measures that member states may adopt to address adverse social impacts. ### (57) it is appropriate to introduce measures to address the potential risk of excessive price increases , which , if particularly high at the start of the buildings and road transport emissions trading , may undermine the readiness of households and individuals to invest in reducing their greenhouse gas emissions. these measures should complement the safeguards provided by the market stability reserve established by decision (eu) 2015/1814 of the european parliament and of the council64 and that became operational in 2019. while the market will continue to determine the carbon price , safeguard measures will be triggered by rules-based automatism , whereby allowances will be released from the market stability reserve only if concrete triggering conditions based on the increase in the average allowance price are met. this additional mechanism should also be highly reactive , in order to address excessive volatility due to factors other than changed market fundamentals. the measures should be adapted to different levels of excessive price increase , which will result in different degrees of the intervention. the triggering conditions should be closely monitored by the commission and the measures should be adopted by the commission as a matter of urgency when the conditions are met. furthermore , in the case of excessive carbon price increases the commission should assess whether the introduction of a concrete price band would constitute an effective measure to counter these increases , and should , where appropriate , submit a legislative proposal to adjust the market stability reserve accordingly. this is without prejudice to any accompanying measures that member states may adopt to address adverse social impacts.


### (57) it is appropriate to introduce measures to address the potential risk of excessive price increases , which , if particularly high at the start of the buildings and road transport emissions trading , may undermine the readiness of households and individuals to invest in reducing their greenhouse gas emissions. these measures should complement the safeguards provided by the market stability reserve established by decision (eu) 2015/1814 of the european parliament and of the council64 and that became operational in 2019. while the market will continue to determine the carbon price , safeguard measures will be triggered by rules-based automatism , whereby allowances will be released from the market stability reserve only if concrete triggering conditions based on the increase in the average allowance price are met. this additional mechanism should also be highly reactive , in order to address excessive volatility due to factors other than changed market fundamentals. the measures should be adapted to different levels of excessive price increase , which will result in different degrees of the intervention. the triggering conditions should be closely monitored by the commission and the measures should be adopted by the commission as a matter of urgency when the conditions are met. this is without prejudice to any accompanying measures that member states may adopt to address adverse social impacts. ### (57) it is appropriate to introduce measures to address the potential risk of excessive price increases , which , if particularly high at the start of the buildings and road transport emissions trading , may undermine the readiness of households and individuals to invest in reducing their greenhouse gas emissions. at the same time , such a situation would threaten to reduce the confidence of the union’s citizens in an appropriately chosen solution to the climate crisis , and could ultimately jeopardise the achievement of the climate protection objectives. these measures should complement the safeguards provided by the market stability reserve established by decision (eu) 2015/1814 of the european parliament and of the council64 and that became operational in 2019. while the market will continue to determine the carbon price , safeguard measures will be triggered by rules-based automatism , whereby allowances will be released from the market stability reserve only if concrete triggering conditions based on the increase in the average allowance price are met. this additional mechanism should also be highly reactive , in order to address excessive volatility due to factors other than changed market fundamentals. the measures should be adapted to different levels of excessive price increase , which will result in different degrees of the intervention. the triggering conditions should be closely monitored by the commission and the measures should be adopted by the commission as a matter of urgency when the conditions are met. this is without prejudice to any accompanying measures that member states may adopt to address adverse social impacts.


### (57) it is appropriate to introduce measures to address the potential risk of excessive price increases , which , if particularly high at the start of the buildings and road transport emissions trading , may undermine the readiness of households and individuals to invest in reducing their greenhouse gas emissions. these measures should complement the safeguards provided by the market stability reserve established by decision (eu) 2015/1814 of the european parliament and of the council64 and that became operational in 2019. while the market will continue to determine the carbon price , safeguard measures will be triggered by rules-based automatism , whereby allowances will be released from the market stability reserve only if concrete triggering conditions based on the increase in the average allowance price are met. this additional mechanism should also be highly reactive , in order to address excessive volatility due to factors other than changed market fundamentals. the measures should be adapted to different levels of excessive price increase , which will result in different degrees of the intervention. the triggering conditions should be closely monitored by the commission and the measures should be adopted by the commission as a matter of urgency when the conditions are met. this is without prejudice to any accompanying measures that member states may adopt to address adverse social impacts. ### (57) it is appropriate to introduce measures to address the potential risk of excessive price increases , which , if particularly high at the start of the buildings and road transport emissions trading , will clearly undermine the readiness of households and individuals to invest in reducing their greenhouse gas emissions. these measures should complement the safeguards provided by the market stability reserve established by decision (eu) 2015/1814 of the european parliament and of the council64 and that became operational in 2019. while the market will continue to determine the carbon price , safeguard measures will be triggered by rules-based automatism , whereby allowances will be released from the market stability reserve only if concrete triggering conditions based on the increase in the average allowance price are met. this additional mechanism should also be highly reactive , in order to address excessive volatility due to factors other than changed market fundamentals. the measures should be adapted to different levels of excessive price increase , which will result in different degrees of the intervention. the triggering conditions should be closely monitored by the commission and the measures should be adopted by the commission as a matter of urgency when the conditions are met. this is without prejudice to any accompanying measures that member states may adopt to address adverse social impacts.


### (57) it is appropriate to introduce measures to address the potential risk of excessive price increases , which , if particularly high at the start of the buildings and road transport emissions trading , may undermine the readiness of households and individuals to invest in reducing their greenhouse gas emissions. these measures should complement the safeguards provided by the market stability reserve established by decision (eu) 2015/1814 of the european parliament and of the council64 and that became operational in 2019. while the market will continue to determine the carbon price , safeguard measures will be triggered by rules-based automatism , whereby allowances will be released from the market stability reserve only if concrete triggering conditions based on the increase in the average allowance price are met. this additional mechanism should also be highly reactive , in order to address excessive volatility due to factors other than changed market fundamentals. the measures should be adapted to different levels of excessive price increase , which will result in different degrees of the intervention. the triggering conditions should be closely monitored by the commission and the measures should be adopted by the commission as a matter of urgency when the conditions are met. this is without prejudice to any accompanying measures that member states may adopt to address adverse social impacts. ### (57) it is appropriate to introduce measures to address the potential risk of excessive price increases , which , if particularly high at the start of the buildings emissions trading , may undermine the readiness of households and individuals to invest in reducing their greenhouse gas emissions. these measures should complement the safeguards provided by the market stability reserve established by decision (eu) 2015/1814 of the european parliament and of the council64 and that became operational in 2019. while the market will continue to determine the carbon price , safeguard measures will be triggered by rules-based automatism , whereby allowances will be released from the market stability reserve only if concrete triggering conditions based on the increase in the average allowance price are met. this additional mechanism should also be highly reactive , in order to address excessive volatility due to factors other than changed market fundamentals. the measures should be adapted to different levels of excessive price increase , which will result in different degrees of the intervention. the triggering conditions should be closely monitored by the commission and the measures should be adopted by the commission as a matter of urgency when the conditions are met. this is without prejudice to any accompanying measures that member states may adopt to address adverse social impacts.


### (58) the application of emissions trading in the buildings and road transport sectors should be monitored by the commission , including the degree of price convergence with the existing ets , and , if necessary , a review should be proposed to the european parliament and the council to improve the effectiveness , administration and practical application of emissions trading for those sectors on the basis of acquired knowledge as well as increased price convergence. the commission should be required to submit the first report on those matters by 1 january 2028. ### (58) the application of emissions trading in the buildings sector should be monitored by the commission , including the degree of price convergence with the existing ets , and , if necessary , a review should be proposed to the european parliament and the council to improve the effectiveness , administration and practical application of emissions trading for the sector on the basis of acquired knowledge as well as increased price convergence. the commission should be required to submit the first report on those matters by 1 january 2028.


### (59) in order to ensure uniform conditions for the implementation of articles 3gd(3) , 12(3b) and 14(1) of directive 2003/87/ec , implementing powers should be conferred on the commission. to ensure synergies with the existing regulatory framework , the conferral of implementing powers in articles 14 and 15 of that directive should be extended to cover the sectors of road transport and buildings. those implementing powers should be exercised in accordance with regulation (eu) no 182/2011 of the european parliament and of the council65 . ### (59) in order to ensure uniform conditions for the implementation of articles 3gd(3) , 12(3b) and 14(1) of directive 2003/87/ec , implementing powers should be conferred on the commission. to ensure synergies with the existing regulatory framework , the conferral of implementing powers in articles 14 and 15 of that directive should be extended to cover the sector of buildings. those implementing powers should be exercised in accordance with regulation (eu) no 182/2011 of the european parliament and of the council65 .


### (60) in order to adopt non-legislative acts of general application to supplement or amend certain non-essential elements of a legislative act , the power to adopt acts in accordance with article 290 of the treaty on the functioning of the european union should be delegated to the commission in respect of articles 10(4) and 10a(8) of that directive. moreover , to ensure synergies with the existing regulatory framework , the delegation in articles 10(4) and 10a(8) of directive 2003/87/ec should be extended to cover the sectors of road transport and buildings. it is of particular importance that the commission carry out appropriate consultations during its preparatory work , including at expert level , and that those consultations be conducted in accordance with the principles laid down in the interinstitutional agreement on better law-making of 13 april 2016. in particular , to ensure equal participation in the preparation of delegated acts , the european parliament and the council receive all documents at the same time as member states' experts , and their experts systematically have access to meetings of commission expert groups dealing with the preparation of delegated acts. in accordance with the joint political declaration of 28 september 2011 of member states and the commission on explanatory documents66 , member states have undertaken to accompany , in justified cases , the notification of their transposition measures with one or more documents explaining the relationship between the components of a directive and the corresponding parts of national transposition instruments. with regard to this directive , the legislator considers the transmission of such documents to be justified ### (60) in order to adopt non-legislative acts of general application to supplement or amend certain non-essential elements of a legislative act , the power to adopt acts in accordance with article 290 of the treaty on the functioning of the european union should be delegated to the commission in respect of articles 10(4) and 10a(8) of that directive. moreover , to ensure synergies with the existing regulatory framework , the delegation in articles 10(4) and 10a(8) of directive 2003/87/ec should be extended to cover the sector of buildings. it is of particular importance that the commission carry out appropriate consultations during its preparatory work , including at expert level , and that those consultations be conducted in accordance with the principles laid down in the interinstitutional agreement on better law-making of 13 april 2016. in particular , to ensure equal participation in the preparation of delegated acts , the european parliament and the council receive all documents at the same time as member states' experts , and their experts systematically have access to meetings of commission expert groups dealing with the preparation of delegated acts. in accordance with the joint political declaration of 28 september 2011 of member states and the commission on explanatory documents66 , member states have undertaken to accompany , in justified cases , the notification of their transposition measures with one or more documents explaining the relationship between the components of a directive and the corresponding parts of national transposition instruments. with regard to this directive , the legislator considers the transmission of such documents to be justified


### (66) in order to mitigate the risk of supply and demand imbalances associated with the start of emissions trading for the buildings and road transport sectors , as well as to render it more resistant to market shocks , the rule-based mechanism of the market stability reserve should be applied to those new sectors. for that reserve to be operational from the start of the system , it should be established with an initial endowment of 600 million allowances for emissions trading in the road transport and buildings sectors. the initial lower and upper thresholds , which trigger the release or intake of allowances from the reserve , should be subject to a general review clause. other elements such as the publication of the total number of allowances in circulation or the quantity of allowances released or placed in the reserve should follow the rules of the reserve for other sectors. ### (66) in order to mitigate the risk of supply and demand imbalances associated with the start of emissions trading for the buildings sector , as well as to render it more resistant to market shocks , the rule-based mechanism of the market stability reserve should be applied to this new sector. for that reserve to be operational from the start of the system , it should be established with an initial endowment of [600] million allowances for emissions trading in the buildings sector. the initial lower and upper thresholds , which trigger the release or intake of allowances from the reserve , should be subject to a general review clause. other elements such as the publication of the total number of allowances in circulation or the quantity of allowances released or placed in the reserve should follow the rules of the reserve for other sectors.


### 2 % of the total quantity of allowances between 2021 and 2030 shall be auctioned to establish a fund to improve energy efficiency and modernise the energy systems of certain member states (‘the beneficiary member states’) as set out in article 10d (‘the modernisation fund’). the beneficiary member states for this amount of allowances shall be the member states with a gdp per capita at market prices below 60 % of the union average in 2013. the funds corresponding to this quantity of allowances shall be distributed in accordance with part a of annex iib. ### 2 % of the total quantity of allowances between 2021 and 2030 shall be auctioned to establish a fund to improve energy efficiency and modernise the energy systems of certain member states (‘the beneficiary member states’) as set out in article 10d (‘the modernisation fund’). all member states may be eligible to benefit from this amount of allowances; priority may be given to the member states with a gdp per capita at market prices below 60 % of the union average in 2013. the funds corresponding to this quantity of allowances shall be distributed in accordance with part a of annex iib.


### in addition , 2 ,5 % of the total quantity of allowances between [year following the entry into force of the directive] and 2030 shall be auctioned for the modernisation fund. the beneficiary member states for this amount of allowances shall be the member states with a gdp per capita at market prices below 65 % of the union average during the period 2016 to 2018. the funds corresponding to this quantity of allowances shall be distributed in accordance with part b of annex iib. ### in addition , 2 ,5 % of the total quantity of allowances between [year following the entry into force of the directive] and 2030 and equivalent of 1 ,5% of the total quantity of allowances from the amount above 600 million allowances set aside in the market stability reserve for the purpose of the modernisation fund shall be auctioned for the modernisation fund. the beneficiary member states for this amount of allowances shall be the member states with a gdp per capita at market prices below 65 % of the union average during the period 2016 to 2018. the funds corresponding to this quantity of allowances shall be distributed in accordance with part b of annex iib.


### in addition , 2 ,5 % of the total quantity of allowances between [year following the entry into force of the directive] and 2030 shall be auctioned for the modernisation fund. the beneficiary member states for this amount of allowances shall be the member states with a gdp per capita at market prices below 65 % of the union average during the period 2016 to 2018. the funds corresponding to this quantity of allowances shall be distributed in accordance with part b of annex iib. ### in addition , 4 % of the total quantity of allowances between [year following the entry into force of the directive] and 2030 and equivalent of 1 ,5% of the total quantity of allowances from the amount above 400 million allowances set aside in the market stability reserve for the purpose of the modernisation fund shall be auctioned for the modernisation fund. the beneficiary member states for this amount of allowances shall be the member states with a gdp per capita at market prices below 65 % of the union average during the period 2016 to 2018. the funds corresponding to this quantity of allowances shall be distributed in accordance with part b of annex iib.


### in addition , 2 ,5 % of the total quantity of allowances between [year following the entry into force of the directive] and 2030 shall be auctioned for the modernisation fund. the beneficiary member states for this amount of allowances shall be the member states with a gdp per capita at market prices below 65 % of the union average during the period 2016 to 2018. the funds corresponding to this quantity of allowances shall be distributed in accordance with part b of annex iib. ### in addition , 2 ,5 % of the total quantity of allowances between [year following the entry into force of the directive] and 2030 shall be auctioned for the modernisation fund. the beneficiary member states for this amount of allowances shall be all member states. priority may be given to member states with a gdp per capita at market prices below 65 % of the union average during the period 2016 to 2018. the funds corresponding to this quantity of allowances shall be distributed in accordance with part b of annex iib.


### in addition , 2 ,5 % of the total quantity of allowances between [year following the entry into force of the directive] and 2030 shall be auctioned for the modernisation fund. the beneficiary member states for this amount of allowances shall be the member states with a gdp per capita at market prices below 65 % of the union average during the period 2016 to 2018. the funds corresponding to this quantity of allowances shall be distributed in accordance with part b of annex iib. ### in addition , 4 % of the total quantity of allowances between [year following the entry into force of the directive] and 2030 and equivalent of 1.5% of the total quantity of allowances from the amount above 400million allowances set aside in market stability reserve for the purpose of modernisation fund shall be auctioned for the modernisation fund. the beneficiary member states for this amount of allowances shall be the member states with a gdp per capita at market prices below 65 % of the union average during the period 2016 to 2018. the funds corresponding to this quantity of allowances shall be distributed in accordance with part b of annex iib.


### in addition , 2 ,5 % of the total quantity of allowances between [year following the entry into force of the directive] and 2030 shall be auctioned for the modernisation fund. the beneficiary member states for this amount of allowances shall be the member states with a gdp per capita at market prices below 65 % of the union average during the period 2016 to 2018. the funds corresponding to this quantity of allowances shall be distributed in accordance with part b of annex iib. ### in addition , 2 ,5 % of the total quantity of allowances between [year following the entry into force of the directive] and 2030 and equivalent of 1.5% of the total quantity of allowances from the amount above 400 million allowances set aside in market stability reserve for the purpose of modernisation fund shall be auctioned for the modernisation fund. the beneficiary member states for this amount of allowances shall be the member states with a gdp per capita at market prices below 65 % of the union average during the period 2016 to 2018. the funds corresponding to this quantity of allowances shall be distributed in accordance with part b of annex iib. in addition , the equivalent of 1.5% of the total quantity of allowances between [year following the entry into force of the directive] and 2030 from the amount above 400 million allowances set aside in market stability reserve for the purpose of innovation fund shall be made available for the innovation fund established under article 10a(8).


### 3. member states shall determine the use of revenues generated from the auctioning of allowances , except for the revenues established as own resources in accordance with article 311(3) tfeu and entered in the union budget. member states shall use their revenues generated from the auctioning of allowances referred to in paragraph 2 , with the exception of the revenues used for the compensation of indirect carbon costs referred to in article 10a(6) , for one or more of the following:; ### 3. member states shall determine the use of revenues generated from the auctioning of allowances , except for the revenues established as own resources in accordance with article 311(3) tfeu and entered in the union budget as general income. the revenue accruing to the union budget shall respect the principle of universality in accordance with article 7 of council decision (eu , euratom) 2020/2053. member states shall use their revenues generated from the auctioning of allowances referred to in paragraph 2 , with the exception of the revenues used for the compensation of indirect carbon costs referred to in article 10a(6) , for one or more of the following:;


### 3. member states shall determine the use of revenues generated from the auctioning of allowances , except for the revenues established as own resources in accordance with article 311(3) tfeu and entered in the union budget. member states shall use their revenues generated from the auctioning of allowances referred to in paragraph 2 , with the exception of the revenues used for the compensation of indirect carbon costs referred to in article 10a(6) , for one or more of the following:; ### 3. member states shall determine the use of revenues generated from the auctioning of allowances , except for the revenues established as own resources in accordance with article311(3) tfeu and entered in the union budget and revenues transferred to aviation transition fund , maritime transition fund in accordance with articles 3d and 3gd. member states , shall use their revenues generated from the auctioning of allowances referred to in paragraph 2 , with the exception of the revenues used for the compensation of indirect carbon costs referred to in article 10a(6) , for one or more of the following:


### 3. member states shall determine the use of revenues generated from the auctioning of allowances , except for the revenues established as own resources in accordance with article 311(3) tfeu and entered in the union budget. member states shall use their revenues generated from the auctioning of allowances referred to in paragraph 2 , with the exception of the revenues used for the compensation of indirect carbon costs referred to in article 10a(6) , for one or more of the following:; ### 3. member states shall determine the use of revenues generated from the auctioning of allowances , except for the revenues established as own resources in accordance with article 311(3) tfeu and entered in the union budget and revenues transferred to maritime transition fund in accordance with article 3gda. member states shall use their revenues generated from the auctioning of allowances referred to in paragraph 2 , with the exception of the revenues used for the compensation of indirect carbon costs referred to in article 10a(6) , for one or more of the following:;