Green Brief: Fifty shades of green

Green brief

Greetings and welcome to EURACTIV’s Green Brief. Below you’ll find the latest roundup of news covering energy & environment from across Europe. You can subscribe to the weekly newsletter here.

 

The media are often criticised for being overly cynical or pessimistic. This is why the first edition of the Green Brief will focus on an area where the EU deserves praise: the European Green Deal.

When the Green Deal was unveiled in December 2019, there was a feeling of revolution in the air. The objectives, to be fair, are impressive: net-zero emissions by 2050, tougher climate goals for 2030 and no less than “zero pollution” in air, water and soil.

For the first time, the President of the European Commission took personal ownership of Europe’s green agenda, saying it was the EU’s “new growth strategy”. In doing so, Ursula von der Leyen marked a clean break from previous Commission presidents, who always saw green policies and economic growth as a trade-off.

Remarkably, the Green Deal managed to survive the COVID-19 pandemic. Despite calls in Poland and the Czech Republic to ditch the strategy, von der Leyen – backed by France, Germany and others – stood her ground, saying the Green Deal will be Europe’s “motor for the recovery”.

If anything, Europe’s green agenda emerged even stronger from the COVID crisis. Germany, the economic powerhouse of Europe, broke a national taboo when Chancellor Angela Merkel agreed to joint European debt as the way forward to rebuild Europe after the crisis.

Of the €750 billion that the European Commission will borrow from the market, 37% will be reserved for climate action and all expenditure will be subject to the “do no significant harm” principle, which de facto excludes fossil fuels from EU recovery funding.

Combined with the transformation of the European Investment Bank (EIB) into a climate bank, this means hundreds of billions of euros will be available to finance the green transition across the European Union.

In many ways, the Green Deal represents a sea change for EU policymaking. In Brussels, everybody I speak to says it has moved the conversation and focused minds on one big priority – climate neutrality – that will drive the political agenda for the next thirty years.

Remarkably, no one is questioning Europe’s climate objectives anymore – even big oil companies say they support it. The conversation is no longer about what to aim for but how to get there.  That in itself is a massive achievement worth celebrating.

But amid all the excitement about going green, people sometimes forget the basic realities. Europe’s economy today is anything but green. And nothing illustrates this better than the European Commission’s attempt to put in place a rulebook for sustainable finance – the so-called taxonomy.

In Germany, an independent study commissioned by the country’s environment ministry, concluded that only 1% of blue chip companies listed on the DAX stock exchange would have been considered “sustainable” if the Commission’s proposed green finance rulebook had been applied. The percentage rose to 2% for the French CAC 40 and the Euro Stoxx 50 indices.

The European Commission is now working on an updated draft of its sustainable finance rulebook, which better defines “transition” activities towards net-zero emissions.

Some reject the idea, saying Europe should leapfrog immediately from brown to green. However, the cost of doing so would simply be too high economically. A better way, which the Commission has chosen, is to try and define the fifty shades of green that will lead Europe to climate neutrality by 2050.

This week’s top stories

News from the capitals

DUBLIN. The Irish cabinet has approved an ambitious climate action bill aiming to put Ireland on the path to net-zero emissions by 2050 and reduce greenhouse gas emissions by 51% within 10 years. (Paula Kenny | EURACTIV.com). More here.

BERLIN. US Secretary of State Antony Blinken said on Tuesday the Nord Stream 2 pipeline being built from Russia to Germany ran counter to the European Union’s own interests and could undermine Ukraine. Read more.

BELGRADE. The Serbian Chamber of Commerce launched on Tuesday the CE HUB Digital Platform for a Circular Economy, intended for the exchange of information, knowledge, and Serbian economic activities in the process of transitioning to a green economy. The platform was unveiled online by representatives of the Serbian Chamber of Commerce’s centre for a circular economy and the UNDP, with the support of German development agency, GIZ. (EURACTIV.rs | betabriefing.com)

BERLIN. Germany said on 16 March it had met its national climate goal for 2020 with 40.8% fewer emissions compared to 1990. But that would not have been possible without the coronavirus-related lockdowns, which helped to drive the biggest reduction in emissions for three decades in Europe’s biggest economy. Read more.

In other news, the SPD’s chancellor candidate Olaf Scholz and the party leadership said on 15 March that a so-called ‘traffic light’ coalition with the Greens and the Liberals could be an option to form a federal government without the conservative CDU/CSU after the federal elections in the autumn. Read more.

HELSINKI. Finland plans to spend half of its recovery funds on the ‘green transition’. The €2.9 billion Finland will receive from the EU’s Recovery and Resilience Facility will be divided between three sectors with 50% of the funding going to enhancing the green transition, and the remaining funds divided between digitalisation and research and development investments, according to the government’s plan released on Monday. More here.

LUXEMBOURG. The International Monetary Fund (IMF) has urged Luxembourg to raise its environmental tax. As part of a report on the country’s economy, the IMF said on Monday (16 March) that the Grand-Duchy should consider increasing environmental levies to offset potential revenue losses stemming from a global taxation reform that targets corporate tax evasion. (Anne Damani | EURACTIV.fr)

LISBON. Portugal is optimistic an agreement can soon be reached on the reform of the Common Agricultural Policy (CAP), the country’s Agriculture Minister Maria do Céu Antunes told EURACTIV in an exclusive interview. More here.

WARSAW. “Poland’s Energy Policy until 2040 (PEP 2040) has a “disappointing lack of ambition,” according to climate change think-tank Ember, which plans the biggest expansion of fossil gas use in the entire EU, from 14 TWh (in 2019) to 54 TWh (in 2030). Read more here, full study here.

ATHENS. Greece’s Public Power Corp. (PPC), the country’s biggest energy company, has surpassed expectations with its first-ever green bond. The energy utility also broke new ground at the EU level by committing to pay investors a higher fee if it misses its climate goals, EURACTIV.gr reports.

BRUSSELS. German EU lawmaker Udo Bullmann has told EURACTIV.com that the Nord Stream 2 pipeline needs a “European” perspective to correct the “mistake” of the past. He also explained the reasons behind Berlin’s logic regarding this controversial pipeline based on foreign policy and environment. The comments come at a crucial moment of escalating US-Russia relations. Read more.

News in brief

“Clean hydrogen is the way to go”: von der Leyen. If the public debate on hydrogen was in need of any more hype, Commission President Ursula von der Leyen provided it last Tuesday (16 March). “Clean hydrogen is a perfect means towards our goal of climate neutrality,” VDL said, speaking on her home turf  at least virtually at the Berlin Energy Transition Dialogue.

“Clean hydrogen can: power heavy industries, propel our cars, trucks and planes, store seasonal energy and heat up our homes. All of this with almost zero emissions,” she added, saying “we will invest in clean hydrogen as never before” thanks to the EU’s €750 billion recovery fund. Watch her full speech here, or read here. (Kira Taylor | EURACTIV.com)

Climate law horse play. The European Parliament is ready to negotiate with the Council on the climate law, but trade-offs must be of equal value, the Parliament’s chief negotiator Jytte Guteland told EURACTIV after the fourth round of negotiations last week. 

Adding that she liked horses, she used a metaphor to describe her take on the negotiations. “If we were trading on a horse market, we would have the miniature ponies, the middle-sized ponies, and then we have the horses. And what I expect is that if we are willing to give a middle-sized pony, then it’s a middle-sized pony in return. And, if there is a horse involved, we need the horse too. And of course, the targets and their 2050 objectives are the horses,” said Guteland. Read the full story here. (Kira Taylor | EURACTIV.com)

Name of the game. As Parliament goes head-to-head with the Council and Commission on its 2030 greenhouse gas reduction target, there has been a flurry of new names for the “Fit for 55” package – revisions and new legislation by the Commission due in in June.

Entries so far include Green MEP, Michael Bloss, taking the Paris Agreement angle, calling it “Fit for 1.5” while Renew MEP Pascal Canfin revealed that Frans Timmermans had said they could call it the “Fit for 2030” package. A final entry came from the Commission, with Director-General Mauro Petriccione going for “Fit for 2050”. (Kira Taylor | EURACTIV.com)

Green light for chemicals strategy. On Monday last week (15 March), the Council approved conclusions on the EU chemicals strategy for sustainability. The strategy, published in October, promotes “safe and sustainable by design chemicals” and aims to have a toxic-free Europe while keeping the EU industry competitive.

Industry lobby group CEFIC, for its part, called for greater policy coherence and asked for a comprehensive strategy consolidating all policies that impact the chemicals industry. “Such policy coherence is essential to attract the unprecedented levels of investments for the Green Deal needs, and to ensure these investments in innovative low-carbon and circular economy solutions can be made here in Europe,” said the director-general, Marco Mensink. Read more. (Kira Taylor | EURACTIV.com)

Eighth environment programme. The Council gave on Thursday (18 March) the Portuguese Presidency its mandate to negotiate the 8th Environment Action Plan (EAP) with the European Parliament. The plan will guide the action and implementation of environmental policies between 2021 and 2030, laying out six objectives, including reducing emissions, climate adaptation and protecting biodiversity.

EU countries added their take, calling for an annual check of progress, actions and upcoming efforts. But WWF has criticised it for not being ambitious enough, saying the policy needs “a true paradigm shift towards a sustainable wellbeing economy” rather than “a vague concept like ‘regenerative growth’”. Read more about the meeting of environment ministers here. (Kira Taylor | EURACTIV.com and Tiago Almeida | Lusa)

Upcoming events

30 MARCH: Sector Integration: How can the EU best create and leverage an integrated energy system? To become climate-neutral by 2050, the EU plans to transform its energy system, which accounts for 75% of its greenhouse gas emissions. Join this EURACTIV Virtual Conference to discuss how the integration of the EU’s energy system can help the EU achieve its 2050 climate target. Register here.

29 APRIL: Blue economy: the potential of our oceans to contribute to a green recovery. According to OECD projections, by 2030, the “Blue Economy” could outperform the growth of the global economy as a whole, both in terms of value added and employment. Join our event to look at how a sector with a turnover of €750 billion that currently employs 5 million people in Europe presents important potential in terms of both its contribution to a green recovery and the European Green Deal goals. Register here

On our radar

26 MARCH: Next trilogue on the climate law. The next climate law trilogue is expected to take place soon so that the 2030 target and can be agreed by late April. But it’s still to be seen whether this will be the last round of negotiations, EURACTIV understands.

22 APRIL: Leaders’ Climate Summit. On the fifth anniversary of the Paris Agreement opening for signatures, the US will host a climate conference convening the leaders of major economies. Washington is also expected to announce its updated Paris commitment around this meeting.

21 JUNE: Environment council. The next meeting of EU environment ministers will be held in June. Ministers are expected to adopt conclusions on the climate adaptation strategy.

JUNE: Fit for 55 package. The Commission is expected to table a huge package of green legislation in June, including a revision of the renewable energy directive, a revision of the emissions trading scheme and our first glimpse at a carbon border adjustment mechanism.

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