European Ceramics Pay the Price of Unsustainable Sustainability
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The European Commission's new ETS benchmarks threaten the competitiveness and survival of Europe's ceramic industry, with Italian and Spanish manufacturers warning of soaring costs, lost investment and forced relocation.
As the revision of the EU Emissions Trading System (ETS) for 2026–2030 enters its critical phase, the draft reform proposals circulated by the European Commission at the end of March came as a cold shower for Italian and Spanish ceramic tile manufacturers attending Coverings in Las Vegas. Just one week earlier, delegations led by ASCER and Confindustria Ceramica , together with the Emilia-Romagna Region and the Generalitat Valenciana, had secured cross-party support in the European Parliament for the manifesto "For the Future of European Ceramics" .
The new ETS benchmarks: a methodological impasse The most critical aspect of the reform concerns the revision of benchmarks used to allocate free CO₂ allowances to sectors exposed to carbon leakage. The new benchmarks are clearly unrealistic , referring to technologies that are not applicable to ceramic production — such as the widespread use of biomass. "This is a deeply flawed approach," said Alberto Echavarria , Secretary General of ASCER, "because the ceramic sector, due to technological constraints and objective limits in resource availability, is not able to use biomass as an alternative fuel." Renaud Batier , Director General of Cerame-Unie, told the European Parliament that "the electrification of ceramic kilns is not yet a mature technology, the electricity grid lacks capacity, and electricity costs three times as much as natural gas. The tools for the transition are simply not ready yet." "This is a mechanism that penalises the most efficient and virtuous ceramic companies," added Graziano Verdi , Vice President of Confindustria Ceramica and President of CET.
The economic impact on Italy and Spain Carbon prices have risen from €5–15/tCO₂ in 2018 to €74–77/t in April 2026 , with peaks above €100/t. With free allowances cut by an estimated 32% versus 2021–2025, ETS costs become virtually unsustainable. For the Italian tile industry, average annual ETS costs would rise from €130M (2021–2025) to €180–200M in 2026–2030 , climbing to ~€225M from 2031. President Augusto Ciarrocchi notes this equals "around half of the annual investments of a sector that has invested €4 billion over the past decade — 6.9% of average annual turnover." The impact per square metre could reach ~€1/m² — impossible to pass on in a hyper-competitive market. In Spain , ASCER estimates direct ETS costs for the Castellón cluster could triple, reaching €109–163M if CO₂ trades at €100–150/t. Add another €55M for producers of glazes, frits and colours.
European production at risk Beyond profit erosion, the reform threatens investments in product and process innovation, leading to a loss of competitiveness and gradual withdrawal from international markets . Manufacturers at Coverings warned: "It is impossible to believe we can remain competitive in the North American market. The risk is that many companies will no longer sustain exports from European plants." "The situation is very serious," said Alberto Selmi , Vice President of Confindustria Ceramica, "and never more than today are we aligned with trade unions and our employees, for whom the risk of job losses is truly high." In 2024, against an estimated ETS cost of €120M, Italian tile makers cut technological investments by more than €80M. Paolo Lamberti , President of ACIMAC, warned: "Europe risks losing a strategic industrial asset. Every skill that leaves Europe is a piece of competitiveness that will never come back."
How much does European ceramics actually pollute? Very little. Studies by Nomisma Energia show European ceramic installations covered by ETS account for just 0.9% of total emissions , despite representing ~8% of regulated installations. They are small emitters — averaging 16,180 tCO₂/year. By comparison, the single highest-emitting ETS installation released ~8.5 million tCO₂ in 2024 alone, comparable to the entire European ceramic sector.
Carbon leakage: the European paradox As designed, the ETS revision could cause more economic damage than environmental benefit — paradoxically increasing global emissions via production relocation and rising imports from non-EU countries with weaker standards. "Europe is scoring an own goal: we will end up importing polluting ceramics while giving up those produced in Europe under the highest sustainability standards," said CET President Graziano Verdi. In 2024, EU production covered 87% of demand (729M of 839M m²). The remaining 110M m² were imported mainly from India (54M) and Türkiye (39M) , with smaller volumes from China, Egypt, Tunisia, the UAE, Saudi Arabia, Ukraine and Serbia. Crucially, ceramics are still NOT covered by CBAM , the EU's Carbon Border Adjustment Mechanism.
The Manifesto "For the Future of European Ceramics" Freezing of current free allowance allocations. Suspension of the benchmark revision for 2026–2030 and introduction of a sector-specific fuel benchmark for ceramics. For small emitters, raising the opt-out threshold from 25,000 to 50,000 tCO₂/year. Application of CBAM to the ceramic sector to safeguard competitiveness on internal and non-EU markets. Creation of dedicated EU funds for strategic R&D on ceramic decarbonisation.