The European Union Emissions Trading System (EU ETS) is a market-based approach to reducing greenhouse gas emissions by setting a cap on the total amount of certain greenhouse gases that can be emitted by regulated entities. It operates on the 'cap and trade' principle, where a limit is set on the total amount of emissions, and this limit is reduced over time to achieve emissions reduction targets.
congrats on reading the definition of European Union Emissions Trading System. now let's actually learn it.