The European Commission introduced a Market Stability Reserve (MSR) in 2019 to remove the surplus of CO2 allowances from the market and ultimately destroy them if the reserve becomes 'too large'. The MSR came into effect in January 2019 and was further tightened in the last revision of the emissions trading system in 2022.

The question arises whether purchasing emission allowances is still necessary if there is now a system intended to remove those allowances from the market.

With the introduction of the MSR, we see that a realistic price for CO2 is being created on the market. A price that can finally really encourage companies to produce cleaner. Because the MSR is working better and better, removing rights from the market is actually becoming more effective; Buying CO2 rights can now immediately result in a higher CO2 price.

Unfortunately, the MSR does not solve everything. If the scarcity becomes too great, (part of) the removed CO2 rights from this fund can be allowed back onto the market. Moreover, billions of allowances will again become available on the market if European countries close their coal-fired power stations to meet climate targets, but do not destroy the emission allowances.

As long as the MSR is unable to eliminate the new surpluses, Carbonkiller will continue. We see the purchasing and destruction of emission allowances by individuals, companies and institutions as a good campaign tool. More social pressure remains necessary to ensure that the emissions trading system works better and that we achieve the Paris climate goals.