What are the EUA price forecasts for 2030?

All experts agree: European Union Allowance (EUA) prices are set to rise. The EU Emissions Trading System (EU ETS) deliberately constrains supply. Regulators want the market to tighten. The higher the price of carbon, the stronger the push toward large-scale decarbonisation.

All experts predict rising carbon prices

The consensus among major financial institutions is now well-established and well-documented. ABN Amro forecasted that EUA prices will reach €95 per tonne by the end of 2025, a 20% increase from then-current levels, driven by a tightening supply-demand balance and bullish speculative flows. The bank notes that a shortfall in wind and solar output would act as an additional short-term catalyst.

Looking further ahead, Citi, using Bloomberg's carbon pricing model, sets its base-case forecast at €145 per tonne of CO2 by 2030, with a projection of €200 per tonne by 2035. These levels are primarily driven by the ongoing reduction in allowance supply and a declining Total Number of Allowances in Circulation (TNAC). Deutsche Bank reinforces this structural view: from 2026 onwards, the EU ETS will tighten considerably as front-loaded auctions come to an end, CBAM is fully implemented, and emission caps are further tightened.

These forecasts remain conditional on the outcome of the regulatory review expected in Q3 2026. The structural fundamentals, however, remain intact: allowance supply is declining mechanically each year, free allocations are being phased out progressively between 2026 and 2034, and new sectors are joining the system, including maritime, aviation, and soon buildings and road transport through ETS 2. The trajectory remains firmly oriented upward.

A tighter market driven by the EU's growing climate ambition

Europe continues to raise its climate ambitions. To meet the targets set by the Paris Agreement and achieve carbon neutrality by 2050, increasingly strict decarbonisation measures are being adopted. Regulators are tightening the EU ETS accordingly, making EUAs scarcer and supporting higher prices.

The Fit for 55 reform plays a central role: it accelerates the annual reduction of the emission cap, with the Linear Reduction Factor raised to 4.3% per year from 2024 and 4.4% from 2028, and sets out the gradual phase-out of EUA auctions by 2039. On 7 April 2026, the European Commission published the first official quarterly CBAM certificate price: €75.36/tCO2, a historic milestone marking the operational launch of the world's first carbon border tax. In force since 1 January 2026, CBAM covers six key sectors: steel, aluminium, cement, fertilisers, hydrogen and electricity, and will structurally reinforce the integrity of the EU ETS price signal.

At the Brussels Summit on 19-20 March 2026, the European Council reaffirmed the central role of the EU ETS, with no member state supporting the idea of suspending the market. A €30 billion industrial decarbonisation fund was announced, financed by the monetisation of 400 million EUA allowances, implying a value of €75 per tonne. The market responded with an 8% rally, reflecting the return of investor confidence.

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Economic recovery and rising industrial activity

European industrial activity is gradually stabilising after several difficult years marked by the post-COVID shock and the energy crisis triggered by the war in Ukraine. The European Central Bank began cutting interest rates in June 2024, and inflation has returned to levels close to the 2% target. These more favourable macroeconomic conditions support a gradual rebound in industrial production through 2026. This recovery will mechanically translate into higher industrial carbon emissions and, consequently, increased demand for EUAs from compliance buyers, adding further upward pressure on top of the regulatory drivers already in place.

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Carbon allowances: a compelling buy-and-hold investment

EUAs are well suited to a medium and long-term investment strategy. The EU's climate objectives span several decades, providing rare visibility on the price trajectory: the market is structurally designed for allowances to become scarcer and increase in value over time. With forecasts of €145 by 2030 and €200 by 2035 according to Citi, the upside potential from the current spot price of €69.99 is significant.

These forecasts remain conditional on the outcome of the regulatory review expected in Q3 2026, an important point of attention for investors. Yet the structural fundamentals remain intact despite political volatility: allowance supply is declining mechanically each year, free allocations are being phased out progressively between 2026 and 2034, and new sectors are joining the system. For patient, long-term investors, EUAs represent a conviction asset at the intersection of environmental impact and financial performance. The trajectory remains firmly oriented upward.

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