It is important to keep talking about climate change and the energy transition because it builds awareness of the issues, helps us better understand what needs to be done, and makes the necessary measures easier to accept. So, let’s keep talking about climate with this update on some of the major European advances that were made over the past few days.
Indeed, on 29 June, the 27 EU environment ministers finally agreed on five key proposals to reduce greenhouse gas emissions and to comply with the targets of the European Green Deal and the Fit for 55 package. These targets call for greenhouse gas emissions to be reduced by at least 55% by 2030 (from 1990 levels), with an ultimate target of carbon neutrality by 2050. This landmark agreement was ironed out in the very last days of the French presidency of the EU Council.
Among the most noteworthy proposals, we would like to highlight:
- The end of sales of new combustion-engine vehicles as of 2035;
- The strengthening of the European carbon market, with the gradual end of free quotas between 2027 and 2032 – which paves the way for the future EU carbon tax. The agreement also calls for expanding the number of business sectors concerned by the Emissions Trading System;
- Lastly, a Social Climate Fund (with nearly 60 billion euros) was announced to protect low-income households from the costs engendered by these measures.
Concerning the green taxonomy, which is another important part of European climate policy, it is a story of “two steps forward and one step backwards”. Indeed, in mid-June, two major commissions of the European Parliament voted against the European Commission’s project to include nuclear power and natural gas in this taxonomy. We will therefore watch closely the full parliamentary vote to be held on the matter in early July.
In the coming months, the triparty talks between the European Commission, Parliament and Council must also definitively adopt the proposals of the climate plan. But more needs to be done. Despite determined statements, the ambitious targets of the Fit for 55 and RePowerEU plans, despite some progresses, to date, the results remain insufficient and too slow to be sure that these objectives will be met and the trajectory of global warming will be curbed. Besides, recent decisions even run against these objectives, such as the restarting of coal-fired power plants for energy security reasons to offset the loss of Russian natural gas supplies.
The current situation starkly reminds the importance of energy as a production factor per se and the related risks of recession that could be triggered by current supply shortages and soaring prices. All this reminds us of the urgency to decarbonize fast our economies and, more globally, to become less energy intensive. Thanks for watching. Tune in again next week for a new edition of EcoTV Week.
