This Week in Automotive — Brussels (#12, 2026)
Commission proposes EU ETS reserve reform; €6bn Italian hydrogen aid approved; Transport ministers plan coordinated crisis response; Horizon Europe opinions issued.
March 29, 2026 to April 04, 2026
Commission proposes EU ETS reserve reform; €6bn Italian hydrogen aid approved; Transport ministers plan coordinated crisis response; Horizon Europe opinions issued.
📋 In This Week's Newsletter
• 📅 This Week's Calendar in Brussels
• 🇪🇺 European Commission
• 🤝 EU Council
• ✒️ EP Committee Work
• 📚 What We're Reading This Week
This Week's Calendar in Brussels
- Committee on Transport and Tourism (TRAN): On April 08, the European Parliament's Committee on Transport and Tourism (TRAN) is scheduled to meet. Agenda includes: Chair’s announcements; Date of next meetings; Framework of measures to facilitate the transport of military equipment, goods and personnel across the Union.
- Committee on Transport and Tourism (TRAN): On April 08, the European Parliament's Committee on Transport and Tourism (TRAN) is scheduled to meet. Agenda includes: * * *; Chair’s announcements; Date of next meetings.
European Commission
Commission proposes reform of EU ETS Market Stability Reserve
The European Commission announced on 31 March 2026 a proposal to amend the Market Stability Reserve (MSR) mechanism within the EU Emissions Trading System (EU ETS). The amendment would end the automatic invalidation of allowances above 400 million in the reserve, allowing them to be retained as a buffer for market stability. The proposal responds to recent volatility in energy prices and follows President von der Leyen's statement at the March European Council. According to Commissioner Wopke Hoekstra, this measure is intended to reinforce the resilience and predictability of the carbon market. The MSR has operated since 2019, addressing surplus allowances and restoring confidence in the EU ETS. The legislative proposal will proceed to the European Parliament and Council under the ordinary procedure, with a comprehensive review of the EU ETS planned for July 2026.
Commission approves €6 billion Italian State aid scheme for renewable hydrogen
On 29 March 2026, the European Commission approved a €6 billion Italian State aid scheme to support renewable hydrogen production for transport and industry. The scheme aims to facilitate the development of 200,000 tons of renewable hydrogen per year, eligible for production via electrolysis using renewable energy or biogenic sources. Aid will be provided through two-way contracts for difference, with strike prices determined via competitive bidding. The scheme is in line with Article 107(3)(c) TFEU and the 2022 Guidelines on State aid for climate, environmental protection and energy (CEEAG). The Commission found the measure proportionate, competitive, and compatible with EU objectives for decarbonisation and industrial competitiveness. The scheme will operate until 31 December 2029, with details published under case number SA.118992.
Commission Q&A: EU ETS Market Stability Reserve
On 31 March 2026, the Commission published a Q&A on the proposed changes to the EU ETS Market Stability Reserve (MSR). The update would retain allowances above 400 million in the MSR, rather than invalidating them, strengthening the reserve's function as a buffer against supply tightness and price volatility. The Commission stated that the EU ETS has reduced emissions by 39% since 1990 and contributed to economic growth. The proposal does not immediately affect market balance, as allowances in the MSR will only be released in cases of tight supply or excessive price increases. The comprehensive review of the EU ETS is scheduled for July 2026, with further adjustments considered to keep the MSR fit for purpose.
EU Council
Transport ministers discuss coordinated crisis response
On 21 April 2026, EU transport ministers held an informal video conference under the Transport, Telecommunications and Energy Council configuration. Discussions focused on measures to address fuel price volatility and strengthen transport sector resilience.
EP Committee Work
Budgetary Control Committee issues opinion on Horizon Europe 2028–2034
On 31 March 2026, the Committee on Budgetary Control (CONT) adopted its opinion on the proposal for a regulation establishing Horizon Europe for the period 2028–2034 (COM(2025)0543 – C10-0164/2025 – 2025/0543(COD)). Rapporteur Olivier Chastel delivered amendments addressing transparency, performance measurement, simplification, and safeguards for sound financial management. The opinion calls for clear benchmarks, risk-based audit systems, and public reporting on programme outcomes, including for innovation and research funding relevant to automotive and transport sectors.
Culture and Education Committee opinion on Horizon Europe regulation
On 30 March 2026, the Committee on Culture and Education (CULT) issued its opinion on the proposed regulation establishing Horizon Europe for 2028–2034. Rapporteur Laurence Farreng focused on policy aspects related to culture and education, including provisions for research dissemination and participation. The opinion is part of the inter-committee consultation for the legislative package, which impacts research and innovation funding across sectors including automotive.
What We're Reading This Week
- EU testing of child car seats reveals multiple failures: Recent safety tests found several child car seats did not meet EU standards, raising concerns about passenger protection.
- Heavy-duty vehicles: Council adopts targeted flexibility for manufacturers to comply with CO2 targets: EU Council introduces new flexibility measures to help heavy-duty vehicle manufacturers meet stricter CO2 emission targets.
- A climate ‘catch-22’: Can EV batteries cope with extreme heat?: Rising temperatures threaten electric vehicle battery performance, raising concerns about reliability and adaptation in a warming climate.
- The next big test for self-driving cars: Self-driving cars face new challenges as they move from controlled environments to complex real-world scenarios.
- Brussels unveils emergency change to EU carbon market to prevent soaring prices: EU regulators introduce urgent reforms to stabilize carbon market and curb potential spikes in emissions trading prices.
