What the EU recovery plan means for climate
…& what it doesn't
THREAD
💶€750b recovery plan + €1.1t budget
💶30% earmarked for climate (no detail)
👩🏭"Just transition fund" cut (+weaker conditions)
🎯New 2030 goal by year end
🚢Carbon border tax from 2023?
📈EUETS to expand?
…& what it doesn't
THREAD
💶€750b recovery plan + €1.1t budget
💶30% earmarked for climate (no detail)
👩🏭"Just transition fund" cut (+weaker conditions)
🎯New 2030 goal by year end
🚢Carbon border tax from 2023?
📈EUETS to expand?
Link is to the 68pp deal, agreed among 27 EU member state govts at "European Council", and due to be signed off by European Parliament on Thursday (so some details could change, but prob not headlines - HT @LindaCulture )
consilium.europa.eu/media/45109/21…
consilium.europa.eu/media/45109/21…
To start with, the overall recovery + budget package is pretty big, at €1.8tn, and includes novelty of €390bn in recovery grants
That's a stimulus of roughly 3% of EU GDP, acc @ThPellerin in this excellent thread on the "good & bad" bits of the deal:
That's a stimulus of roughly 3% of EU GDP, acc @ThPellerin in this excellent thread on the "good & bad" bits of the deal:
Based on overall €1.8tn, the 30% earmarked for climate could be worth €550bn
And all spending should be "consistent" with Paris (whatever that means)
But there's no detail on how the 30% figure will be monitored. Methodology for annual reporting TBC.
consilium.europa.eu/media/45109/21…
And all spending should be "consistent" with Paris (whatever that means)
But there's no detail on how the 30% figure will be monitored. Methodology for annual reporting TBC.
consilium.europa.eu/media/45109/21…
see for eg this on the challenge of tracking the 30% for climate
For most of the €750bn recovery deal, member states will draw up their own plans to spend money they are allocated, subject to approval by the Commission and Council
But again, the requirements on climate are vague (what is an "effective contribution"?)
consilium.europa.eu/media/45109/21…
But again, the requirements on climate are vague (what is an "effective contribution"?)
consilium.europa.eu/media/45109/21…
European Commission initially floated ambitious proposals for direct EU climate spending (pic), including a "renovation wave" to retrofit buildings.
That's been ditched along the way in favour of member states coming up with their own plans.
carbonbrief.org/coronavirus-tr…
That's been ditched along the way in favour of member states coming up with their own plans.
carbonbrief.org/coronavirus-tr…
The "just transition fund" –to support fossil-reliant regions towards net-zero– is cut from €40bn proposed to €17.5bn
Those not signed up to EU net-zero (=PL) will get 50% allocation unless they sign up.
But PL not required to set a national NZ goal.
consilium.europa.eu/media/45109/21…
Those not signed up to EU net-zero (=PL) will get 50% allocation unless they sign up.
But PL not required to set a national NZ goal.
consilium.europa.eu/media/45109/21…
Recovery funds for research and innovation –under the Horizon and InvestEU programmes– were also cut in the final deal
What else?
The EU will finally, by year end, raise the ambition of its 2030 climate goal, currently to cut emissions "at least 40%" below 1990 levels.
All eyes of German EU presidency to secure this.
(Merkel now supports Commission 50-55% goal:
)
The EU will finally, by year end, raise the ambition of its 2030 climate goal, currently to cut emissions "at least 40%" below 1990 levels.
All eyes of German EU presidency to secure this.
(Merkel now supports Commission 50-55% goal:
)
On the "carbon border adjustment", von der Leyen's commission came in last year promising to introduce this.
Now she has agreement from member states, crucially also now including Germany, I hear.
But it still isn't a done deal.
ec.europa.eu/commission/sit…
Now she has agreement from member states, crucially also now including Germany, I hear.
But it still isn't a done deal.
ec.europa.eu/commission/sit…
So far, the carbon border tax has made slow progress…
An "inception impact assessment" was open for comment in March this year but has few details, see pic.
They're very much at the scoping stage here.
ec.europa.eu/info/law/bette…
An "inception impact assessment" was open for comment in March this year but has few details, see pic.
They're very much at the scoping stage here.
ec.europa.eu/info/law/bette…
Meanwhile, EU leaders have been using carbon border tax as a threat in public-facing negotiations around global climate ambition…
At COP25 "I hope then there will be no need for such a measure, but if it is necessary, we will not hesitate to take it"
uk.reuters.com/article/uk-cli…
At COP25 "I hope then there will be no need for such a measure, but if it is necessary, we will not hesitate to take it"
uk.reuters.com/article/uk-cli…
The current plan is to introduce draft legislation in 2021 "with a view to" adoption by 2023.
NB the conditional language here.
consilium.europa.eu/media/45109/21…
NB the conditional language here.
consilium.europa.eu/media/45109/21…
For my money, the political utility of saying you will introduce a carbon border tax is high –within EU & globally– whereas the political barriers to actually doing it are perhaps ever higher.
The technical challenges are also formidable.
Let's see.
The technical challenges are also formidable.
Let's see.
I'd also urge caution on EU ETS reform, which this EU deal mentions could expand the scope to sectors such as international aviation and shipping.
But there's so little detail here, we just don't know how it will play out (apart from *slowly*).
consilium.europa.eu/media/45109/21…
But there's so little detail here, we just don't know how it will play out (apart from *slowly*).
consilium.europa.eu/media/45109/21…
Finally, just to reiterate that at least some details of the EU deal can and will be changed by the European Parliament, which is not overly impressed by the contents
