Thread by @dfirgs

Thread

1/ I've said it before and I'll say it again:

Leaving #sustainablefinance standard setting to the EU alone (while the best we can do in light of Trump) is a suboptimal solution to a real challenge for the global capital markets' transition to net zero.

Case in point 👇

https://twitter.com/CarbonBubble/status/1257263544782983168

2/ The @EU_Commission under the leadership of @vonderleyen @TimmermansEU @VDombrovskis, plus @ESMAComms @eiopa_europa_eu & other regulators, have done an admirable job moving the #SustainableFinance agenda forward under difficult circumstances. See: ec.europa.eu/info/business-…

3/ Yet without US capital markets regulators like SEC/CFTC/Treasury/Fed in the game, we're stuck with a very European, prescriptive approach to #SustainableFinance regulation... e.g. treating "solid" fossil fuels like coal differently than oil & gas. ft.com/content/07083d…

4/ This is not to say a US approach would be perfect. Far from it! But as in so many other cases, we might have crafted a more principles-based framework that captures the intent of the regulation: investors must disclose the full climate impact of their investments.

5/ For instance, California's #AB32 climate law & its low-carbon fuel standard, take pains to look at lifecycle GHG emissions across the value chain of all fuels. That way, perverse outcomes can be avoided (like corn-based ethanol with higher emissions than gasoline!) #LCFS

6/ Unfortunately, an overly prescriptive, rules-based approach to #SustainableFinance in the EU draft seems to yield irrational results, where one fossil fuel is "in" and another is "out" of a category... with all sorts of unintended consequences.

7/ Two takeaways:

First, the @EU_Commission is doing great work, will likely correct its mistake, and should be applauded for its leadership role!

Second, Biden MUST incorporate @ewarren's "Financing the Climate Crisis" plan to get US back in the game! elizabethwarren.com/plans/financin…