Part I — Situation overview

The prime ministers of the Visegrád Four — the Hungarian, Polish, Slovak and Czech heads of government — held a joint press conference on 10 September 2026 in the company of Irish Taoiseach Micheál Martin, at which Polish Prime Minister Donald Tusk announced on behalf of the group: “whether we are talking about ETS1, about ETS2 or about other proposals, anything that brings us the risk of more expensive energy, we will block it”. The ETS (Emissions Trading System) is the EU mechanism operating since 2005 in which polluters must buy emission allowances; ETS1 covers energy production and heavy industry, while ETS2 would bring in road transport and buildings — the group has already secured a postponement of the latter’s introduction. Czech Prime Minister Andrej Babiš gave the most concrete datum of the press conference: in 2020 the Commission forecast an allowance price of 26.50 euros for 2030, whereas today the allowance stands at around 80 euros. Tusk added that “we can forget our dreams of competing with China or the United States if our energy prices stay as they are now”.

A day later, on 11 September, the German centre-right MEP Peter Liese, rapporteur for the ETS review, tabled his amendments overwriting the Commission text. The proposal moves in two directions at once. On the one hand it would oblige member states to devote 75 per cent of their revenue from allowance sales to the decarbonisation of domestic industries covered by the system — in the Commission’s July draft this share was 50 per cent. On the other hand it would slow the reduction of the emissions cap: with a linear reduction factor of 3.4 per cent a year from 2031 and 2.3 per cent from 2036. According to Liese’s reasoning many industries are suffering from high carbon-dioxide costs, and for aviation, cement, steel and the chemical industry reaching zero emissions by 2039 is “impossible”. At the same time he added: “you cannot emit forever, but it has to be predictable, and it has to proceed step by step”. The parliamentary draft report is to be presented on 15 September.

MIAK’s reading: the Hungarian government has now publicly committed itself to a blocking position, but it must also be able to show the legal instrument for it — and here lies the problem. Climate legislation is decided in the ordinary legislative procedure, by qualified majority in the Council; a blocking minority requires at least four member states and more than 35 per cent of the EU population. The four Visegrád countries together number roughly 62 million people, around 14 per cent of the EU population — not even half the threshold. The announcement is therefore a political signal whose real stake is not the vote but coalition-building. Meanwhile the substantive bargain is there in the Liese proposal: allowance revenue is today free revenue of the central budget, whereas the 75 per cent constraint would create a predictable industrial modernisation resource that can be planned over several years — in exchange for narrower budgetary room for manoeuvre. In a country where the automotive industry and battery manufacturing form the backbone of the economy, and both are directly affected by carbon-dioxide pricing, this exchange is in itself worth weighing — it is not obviously a bad deal.

Part II — Foundations in the literature

Three sources provide the frame in which the announcement can be assessed. The American economist William D. Nordhaus, founder of the economic modelling of climate change, built in Warming the World (2000), written jointly with Joseph Boyer, the family of models from which the path of carbon-dioxide pricing and regional burden-sharing can be derived — the volume’s central question is precisely how costs and benefits are distributed across the world’s regions under different policies. The American political scientist Elinor Ostrom, researcher of the governance of common resources (awarded the Nobel Memorial Prize in Economics in 2009), identified in Governing the Commons (1990) eight design principles in enduringly functioning systems managing common resources; the eighth — nested, multi-level governance — points directly at the shortcoming characterising today’s Hungarian position. Thucydides, the ancient Greek historian to whom MIAK’s KP17 programme point also refers, describes in his analysis of the Peloponnesian War the mechanism whereby allies join a decision on the basis of their own interests rather than of arguments — this is the basic rule of coalition-building. The detailed treatment of the literature — by author, with quotations — is in section 6.4 Literature in detail.

Part III — MIAK’s concrete proposal

MIAK proposes three measurable measures. None of them aims at renouncing climate targets or at withdrawing the position announced — their purpose is to turn the announcement into a negotiating result.

3.1 A separate budget line for allowance revenue and an industrial transition envelope (by the submission of the 2027 budget)

MIAK proposes that Hungary should not wait for the Brussels decision but should, by the submission of the 2027 budget, create a separate budget line for allowance-sale revenue and attach to it a public rule of use. The rule should split the revenue into two branches: one branch financing the decarbonisation investments of energy-intensive industries according to the conditional support logic of the G9 strategic industrial policy programme point — that is, with an annual performance review and a reduction of support if the indicators are not met — and the other branch serving the targeted protection of household energy bills. This has two benefits. One is a matter of negotiating technique: if the domestic rule already exists, the 75 per cent EU constraint does not create a new obligation but sanctions existing practice — that is, the cost of the proposal for Hungary is substantially smaller. The other is domestic: today the revenue is a free resource of the central budget and therefore the subject of a political decision year by year, whereas the K5 just transition programme requires multi-year, predictable financing.

3.2 Income-linked household energy compensation under the automatic mechanism of K7 (by the first half of 2027)

The political force of the V4 announcement derives from the fact that rising household energy prices are a real social problem — disputing this is pointless. MIAK proposes, however, that the answer should not be to block the source of the price rise but to compensate the effect in a targeted way. The K7 energy-market shock resilience and the G25 energy-price shock preparedness plan programme points describe the same mechanism: if the energy price index exceeds the twelve-month average by 30 per cent, households in the bottom 40 per cent income band receive automatic support activated within 48 hours. MIAK proposes that this mechanism take a form fixed in legislation by the first half of 2027, and that its funding be the second branch of the allowance-revenue line described in point 3.1. Its decisive difference from general price support is that it preserves the price signal — that is, it does not eliminate the incentive for energy-efficiency investment — while protecting those whom the price rise actually pushes into a supply-security risk.

3.3 An issue-based climate coalition to reach the 35 per cent threshold (by the end of the Council negotiating phase)

The KP17 issue-based coalition-building programme point was written precisely for this situation. MIAK proposes that the Hungarian negotiating position be built not on the rhetoric of the V4 as a bloc but on an issue-tailored coalition built along shared interests: Romania, Bulgaria, Italy and Greece are all member states with similar exposure because of energy-intensive industry or a high household energy-price burden. The four Visegrád countries, supplemented by Italy and Romania, would already comfortably exceed the 35 per cent population threshold — that is, actual blocking capability is attainable, whereas with mere V4 rhetoric it is not. The concrete form of the proposal: by the end of the Council negotiating phase the climate-policy chapter of the annual Coalition Map under the KP17 programme point should be prepared and published, naming item by item which member states share an interest on which sub-question. This document is at once a negotiating instrument and an accountability instrument: it shows afterwards whether the announced position was successfully converted into votes.

The three proposals are bound together by the same principle: a negotiating position is worth something if there is arithmetic behind it and a domestic rule behind it. The announcement in itself replaces neither. If the Hungarian government cannot convert the promise of a veto into votes, and meanwhile does not bargain for the compensation channel either, then the tightening of emissions trading will occur while the accompanying resource is not built into domestic budgetary and industrial planning — that is the worst possible outcome.

Part IV — Expected effects and risks

Dimension Expected effect Risk
Economy and industry A separate line for allowance revenue gives a multi-year, predictable resource for modernising energy-intensive sectors; this directly reduces the exposure of the automotive industry and battery manufacturing The 75 per cent constraint narrows budgetary room for manoeuvre; if the revenue falls as the allowance price declines, the promised industrial resource also dries up while the obligation remains
Society Income-linked compensation protects those for whom the price rise becomes a supply-security risk, and preserves the incentive for energy-efficiency investment Targeted support visibly reaches fewer households than a general price cap — this is politically harder to defend, even if it is fiscally more efficient
Foreign policy An issue-based coalition may lead to an actual blocking minority and bring measurable results in EU negotiations instead of rhetoric The practice of “a different coalition every time” signals unpredictability and may increase distrust among V4 partners; supplementary partnerships must be built while retaining the regional frame

The package’s main tension runs between the position announced and the actual room for manoeuvre. A government that has publicly promised a veto turns politically with difficulty into a bargaining position without this being read as a retreat. The proposal tips towards the risk side if the two directions run in parallel: if the government communicates blocking outwardly while bargaining over compensation at the negotiating table, it will be credible in neither position — negotiating partners read the public stance, and the domestic audience reads the result. The second question for deliberation is the slowing of the cap. The Liese proposal offers slower emission reductions in exchange for the 75 per cent revenue constraint; in the short term this eases the industrial burden, but over the longer term it increases the cost of later adjustment and may cause a lock-in effect — a company investing now plans on the basis of the slower path and in ten years faces the stricter framework.

Part V — Measurability and summary

5.1 What is worth following? (suggested KPIs)

MIAK proposes four performance indicators (KPIs, in English: Key Performance Indicator) from which it will be visible in 12 and 36 months whether the announcement produced a result:

  • The existence and amount of the separate budget line for allowance revenue: the suggested target is that it appear in the 2027 budget on a separate revenue and expenditure line, with a public rule of use.
  • The size of the issue-based climate coalition: the suggested target is that by the Council vote at least six member states stand behind the Hungarian position, together exceeding 35 per cent of the EU population. This is the threshold above which the position also has legal consequences.
  • The household electricity price measured at purchasing power parity: this indicator tells us whether the household burden is actually falling — the price measured in euros is in itself misleading, because it does not take income levels into account. Source: the Eurostat nrg_pc_204 data series.
  • The activation time of the compensation mechanism: the suggested target of the K7 programme point is activation within 48 hours; it is worth following whether the legislative form is completed by the first half of 2027.

5.2 Summary

MIAK’s request in a single sentence: alongside the announcement of blocking, put the arithmetic and the domestic rule. Concretely: a separate budget line and public rule of use for allowance revenue by the submission of the 2027 budget, an income-linked household compensation mechanism enacted in legislation by the first half of 2027, and a public climate coalition map by the end of the Council negotiating phase. In MIAK’s view the Hungarian interest is not to stop climate regulation but to bargain over the distribution of the burdens — protecting household energy bills with targeted, income-linked support, and financing industrial adjustment from allowance revenue.

Two MIAK foundational values are at stake here. One is data-drivenness: the threshold for a blocking minority is not a matter of opinion but of arithmetic — four countries and 14 per cent are not enough, and this has to be known before a negotiating position is formulated, not afterwards. The other is accountability: a publicly announced promise of a veto is a commitment to voters, so it must be made measurable afterwards whether it was fulfilled — publishing the coalition map makes precisely this measurement possible, and the yardstick stays the same for every future government too.

Part VI — Reasoning and further sources

6.1 Press framing by spectrum

The topic was covered in the international specialist press, and the framing split into two separate axes. Notes from Poland, representing the Central European perspective, embedded the announcement in the context of the region’s energy-price burden and backed it with the most concrete data: in the second half of 2025 Polish households paid 27.09 euros per 100 kilowatt-hours including taxes and charges, which is below the EU average of 28.96 euros — measured at purchasing power parity, however, it was 37.15 units, that is, the second highest in the EU, exceeded only by Romania (49.52) and the Czech Republic (39.16). This dual reporting of data is the essence of the framing: the paper did not make the case for price support but showed that the raw price and the burden are two different things. The article also recorded the Polish domestic political context — that the main opposition party demands unilateral withdrawal from the system and that the head of state twice initiated a referendum on the question — that is, it interpreted the announcement partly as a step taken under domestic political pressure.

The Brussels specialist outlets, by contrast, made the parliamentary bargain the centre of their framing and did not even mention the V4 announcement. EUobserver presented the rapporteur’s proposal as part of the industrial competitiveness debate and placed it in the context of the centre-right group’s wider effort to revise the green legislation of 2019 to 2024 — the article therefore gave a group-political rather than a member-state reading. The two Euractiv articles were publicly readable only as far as their opening section; from the headlines it can be established that one highlights the rapporteur’s intention to protect industry, while the other highlights an earlier element concerning a 2045 net-zero deadline — that is, the proposal contains both tightening and easing elements, and the specialist press broke this duality into separate articles.

The most important difference between the framings is that the Central European reading is about the household burden and the Brussels reading about industrial competitiveness — and the Liese proposal substantively answers the latter. From MIAK’s point of view this gap is the most essential observation: the 75 per cent revenue constraint creates an industrial resource but in itself gives no answer to household energy poverty. This is the point at which domestic regulation has to fill the gap.

6.2 Facts and data

Datum Value Source
Day of the V4 announcement 10 September 2026, joint prime ministerial press conference, with the participation of Irish Taoiseach Micheál Martin Notes from Poland, 11 September 2026
Tabling of the rapporteur’s amendments 11 September 2026; presentation of the parliamentary draft report on 15 September EUobserver, 11 September 2026
Revenue constraint in the Commission proposal 50% of allowance revenue for domestic industrial decarbonisation EUobserver, 11 September 2026
The rapporteur’s amendment 75% of allowance revenue for domestic industrial decarbonisation EUobserver, 11 September 2026
Proposed reduction of the emissions cap linear reduction factor of 3.4% a year from 2031, 2.3% a year from 2036 EUobserver, 11 September 2026
The 2020 forecast of the allowance price for 2030 26.50 euros statement by Czech Prime Minister Andrej Babiš / Notes from Poland, 11 September 2026
Current price of the allowance around 80 euros statement by Czech Prime Minister Andrej Babiš / Notes from Poland, 11 September 2026
Polish household electricity price, H2 2025 27.09 euros / 100 kWh (including taxes), 11th highest in the EU Eurostat, as reported by Notes from Poland
EU average household electricity price, H2 2025 28.96 euros / 100 kWh Eurostat, as reported by Notes from Poland
Highest prices measured at purchasing power parity Romania 49.52, Czech Republic 39.16, Poland 37.15 units / 100 kWh Eurostat, as reported by Notes from Poland
Combined population of the V4 countries around 62 million, roughly 14% of the EU population MIAK’s own calculation based on Eurostat population data
Threshold of a Council blocking minority at least 4 member states together representing more than 35% of the EU population Treaty on European Union, qualified majority rule

Two data points require a separate note. This analysis does not state the exact annual amount of Hungarian allowance-sale revenue, because the public sources gave no uniform, citable figure for it — this datum can be established from the budget act and the EU emission allowance registry, and the first step of proposal 3.1 is precisely to set it out transparently. The content of the two Euractiv articles was behind a subscription; the statements drawn from them are confined to the publicly available opening section and the headline.

6.3 Policy dimensions

  • Environment and climate (programme points) — financing the transition and managing the shock: K5 (just transition programme) provides the framework of use for the industrial branch of allowance revenue, and K7 (energy-market shock resilience) the automatic mechanism of household compensation; K2 (energy transition plan) defines the path to which investments must be aligned;
  • Foreign policy (programme points) — the structure of the negotiating position: KP17 (issue-based coalition-building in the EU) is the programme point written precisely for this situation, together with the instrument of the annual Coalition Map;
  • Economy (programme points) — the budgetary and industrial-policy side: G25 (energy-price shock preparedness plan) gives the compensation thresholds, and G9 (strategic industrial policy) the logic of conditional, performance-linked support.

6.4 Literature in detail

6.4.1 William D. Nordhaus – Joseph Boyer: Warming the World

The volume by Nordhaus and Boyer is a foundational work of the economic modelling of climate policy: with the DICE and RICE families of models the authors calculate how the carbon-dioxide price, the pace of emission reduction and — most importantly for the present topic — the regional distribution of costs and benefits develop under different regulatory paths. The structure of the volume is itself telling: separate tables present the global net economic effect of each policy, the cost of emission reduction and its environmental benefit, and the regional net economic effect — that is, the model expressly addresses the question that the same climate policy produces a different balance for different regions.

In the present debate this approach makes two things clear. One is that “more expensive energy” as an argument does not stand alone in economic terms: the price of an emission allowance is a cost, but so is the failure to reduce emissions, and without comparing the two neither side can be justified. The other is that managing regional burden-sharing is not an exception to climate policy but a built-in part of it — the modelling literature has for decades been working with the question of how the burden can be distributed so that regions with different economic structures are not driven out of the agreement.

For the Hungarian position this means that the right question is not whether emissions trading makes energy more expensive — it obviously does, that is its purpose — but how large the burden is relative to the structure of the Hungarian economy, and what compensation channel counterbalances it. This is precisely the subject of the 75 per cent constraint in the Liese proposal.

📖 Source: William D. Nordhaus – Joseph Boyer: Warming the World — Economic Models of Global Warming

6.4.2 Elinor Ostrom: Governing the Commons

From her study of enduringly functioning systems managing common resources Ostrom derived eight design principles. The eighth — the principle of nested enterprises — is the most important for the present topic, because it names the absence of multi-level regulation as a typical cause of the failure of such systems:

“Appropriation, provision, monitoring, enforcement, conflict resolution, and governance activities are organized in multiple layers of nested enterprises. […] Establishing rules at one level without rules at the other levels produces an incomplete system that may not survive over the long run.”

To this Ostrom adds — at the seventh principle — that the right of local actors to make rules must be recognised at least minimally by higher-level authorities; if the external authority assumes that only it may make rules, the system cannot be sustained at the local level.

The structure of emissions trading is precisely such a multi-level system managing a common resource: the atmosphere is the common resource, the EU ETS is the upper regulatory layer, and member-state budgetary and social-policy decisions are the lower one. Hungary’s situation today is, in Ostrom’s description, a case of the “incomplete system”: there is a rule at EU level but none at domestic level — there is no fixed order for the use of allowance revenue and no automatic mechanism for household compensation. A veto as a strategy does not help with this, because preventing the upper-level rule does not make up for the absence of the lower-level rule. The first two points of MIAK’s proposal would build out precisely this lower level.

📖 Source: Elinor Ostrom: Governing the Commons — The Evolution of Institutions for Collective Action

6.4.3 Thucydides: History of the Peloponnesian War

Analysing the causes of the war’s outbreak, Thucydides sharply distinguishes between the allies’ arguments and the actual motive of the decision. Of the Spartan assembly’s decision he writes:

“The Lacedaemonians voted that the treaty had been broken and that war must be declared — not so much because they were persuaded by the arguments of their allies as because they feared the growth of the power of the Athenians.”

The essence of the observation is that an alliance decision is produced not by rhetoric but by one’s own interest and one’s own sense of threat. Elsewhere in the work Thucydides also shows that rigid alliance blocs are fragile: as soon as the members’ interests diverge, the formal alliance does not hold them together, and the isolated party is left at the mercy of the other side.

Applied to today’s situation, this is the central claim of the KP17 programme point. The V4 as a formation is valuable as a regional frame, but in climate-policy matters the shared interest of the four countries does not extend to every sub-question — the coal exposure of the Czech Republic and Poland, Slovakia’s share of nuclear energy and Hungary’s automotive exposure create different bargaining positions. At the same time shared interest can also be found outside the formation: the household energy-price burden of Romania and Bulgaria and the energy-intensive industry of Italy and Greece touch on other sides of the same question. On Thucydides’ lesson, these states will join a Hungarian position not because the announcement was loud but if it is also advantageous on their own balance sheet — which is why the Hungarian position must be broken down into concrete sub-questions where this advantage can be demonstrated.

📖 Source: Thucydides: History of the Peloponnesian War

6.5 International comparison

On the question of using allowance revenue the most instructive example is Germany, where a significant part of the revenue finances building-energy and industrial decarbonisation programmes through the Energy and Climate Fund; that is, the 75 per cent requirement of the Liese proposal would not represent a major change compared with German practice. This also explains the political structure of the proposal: the revenue constraint is costly for those countries where allowance revenue is today a free resource of the budget — that is, precisely for Hungary and several states of the region. The timing of MIAK’s proposal follows from this: if the domestic rule is completed before the negotiations close, the Hungarian position becomes capable of bargaining, because the constraint no longer represents a new burden.

In the field of household compensation the most relevant lesson comes from two examples also featured in the K5 programme point. Germany’s coal phase-out programme set aside 40 billion euros for the regions affected up to 2038, for retraining, infrastructure and business incentives; and Spain, when closing its coal mines in 2018, secured early retirement and retraining through a tripartite agreement between the government, trade unions and mining companies, and the transition there proceeded relatively free of conflict. The common element of both cases is that compensation was fixed in advance, of a concrete amount and directed at a named target group — it did not appear in the form of a general price cap.

The third lesson of the debate around postponing ETS2 concerns lock-in risk. Postponing the inclusion of road transport and buildings reduces the household burden in the short term but does not eliminate the future obligation — which is why the postponement is worth using to scale up the K6 building-energy preparation programme. If the energy condition of the building stock does not improve during the deferred period, the later introduction of ETS2 will cause the same shock, only at a higher allowance price.

Environment and climate

  • K2 — Energy transition plan
  • K5 — Just transition programme
  • K6 — Building energy-efficiency programme
  • K7 — Energy-market shock resilience

Foreign policy

  • KP17 — Issue-based coalition-building in the EU

Economy

  • G9 — Strategic industrial policy
  • G25 — Energy-price shock preparedness plan

Proposed new programme point: Rule on the use of allowance revenue — for the Environment and climate policy area: the revenue from selling emission allowances should appear on a separate budget line, with a fixed, public sharing ratio between industrial decarbonisation and targeted household energy compensation.

6.7 List of sources

Press sources (MIAK international press monitor, 12 September 2026 — topic 1):

Knowledge-base references (books):

  • 📖 William D. Nordhaus – Joseph Boyer: Warming the World — Economic Models of Global Warming
  • 📖 Elinor Ostrom: Governing the Commons — The Evolution of Institutions for Collective Action
  • 📖 Thucydides: History of the Peloponnesian War

MIAK internal materials:

  • MIAK policy area: Environment and climate (programme points; programme point ID: K2, K5, K6, K7)
  • MIAK policy area: Foreign policy (programme points; programme point ID: KP17)
  • MIAK policy area: Economy (programme points; programme point ID: G9, G25)
  • MIAK international press monitor, 12 September 2026 — topic 1, score: 91/100

Supplementary public data sources:

  • Eurostat nrg_pc_204 — household electricity price, in euros and at purchasing power parity
  • EU ETS Union Registry — allowance price time series and member-state auction data
  • MEKH energy price reports and KSH household energy consumption data
  • The European Commission’s July 2026 ETS review proposal and impact assessment

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