Where does the EU stand on climate policy, and what is the European Green Deal? (3/4)

The political world is a complex one, and European climate policy is no different. Filled with different committees, voting stages, and legislative packages, there is a lot for any person to unpack. So to help you, the outdoor community, better understand the institutions and processes that determine the fate of our beloved outdoor spaces, we give you “EU Policy 101”. This four-part series narrows down the playing field, offering some fundamental basics towards understanding EU climate policy. We hope you will tune in and learn a little more about the politics shaping our natural world’s future. After all, you can’t solve the problem until you ask the right question.

In the first instalment of our EU Climate Policy series, we covered the  four major European Union legislative institutions; the European Commission, the European Parliament, the European Council, and the Council of the European Union. In the second, we moved deeper into what the EU’s voting, decision-making, and legislative processes look like. In this third instalment, we move past the fundamentals of who does what to look directly at EU climate policy.

Climate Change in Europe

Whether you live in Australia, North America, Africa or Europe, climate change is knocking at your door. And over the past few decades, scientists have warned us about our use of natural resources, a warming planet, and the dire consequences it will have on our way of life. While we may notice winters with less snow, receding glaciers in the Alps, and summer heat waves increasing in length and intensity, there are many more pieces to the climate-change puzzle. 

Human influence, primarily greenhouse gas emissions and land use, have been the dominant causes of warming since the mid-19th century. We see the impacts of climate change in accelerating global sea-level rise, changes in various climate extremes, and changes in the global water cycle. Precipitation has generally increased in northern and north-western Europe but has generally decreased in southern Europe. Snow cover in Europe has been declining, and so has the extent and volume of Arctic sea ice – even faster than previously projected. Yet these are just a few of the many impacts of climate change, which vary significantly across Europe depending on your geographic (and socio-economic) conditions. Here are a few:

– Do you live in the arctic, like in Greenland, Svalbard or Northern Norway? Expect to see the loss of biodiversity, loss of permafrost, and intensified oil exploitation.

– Do you live in Central or Eastern Europe? Expect decreases in summer precipitation, increased risk of forest fires, and an increase in water temperatures. 

– Do you live or enjoy visiting high mountain regions? Expect Alpine species extinction, increased soil erosion, loss of glaciers, and less skiing. 

– Or do you happen to live in Southern Europe, where the effects of climate change are hitting hardest? Expect decreases in precipitation year-round, desertification, decreased crop yields, and increased mortality rates from heat waves. 

EU Climate Policy History

Even though human-caused climate change has been on the discussion table since the late 19th century, the history of climate policy in the EU really only got going at the end of the 20th century. In 1990, after the release of the first summary report of the Intergovernmental Panel on Climate Change (IPCC), the European Council felt it was time to discuss climate change. Namely, in preparation for the upcoming negotiations on the United Nations Framework Convention on Climate Change (UNFCCC).

At the convention, EU leaders agreed to stabilise GHG emissions by 2001. However, since they never specified measures to achieve emissions reductions, it triggered a discussion about standard, coordinated policies and measures (PAMs). In this early process of climate policy development, they identified three main areas of climate policy that are still present today: reducing GHGs, promoting renewable energy sources (RES), and improving energy efficiency (EE).

The EU’s Three Tools of Climate Action

Eventually, and as a follow up to the commitments set out in the Paris Agreement, the EU moved forward with what we call the European Green Deal in 2020. But along the way, the European Union used a few major tools to focus it’s ever changing climate policy – here are the three big ones (all of which are undergoing reforms in the current ‘Fitfor55’ package):

The EU Emissions Trading System (EU ETS)

The EU ETS is one of Europe’s main tools to cost-effectively combat climate change and reduce greenhouse gas (GHG) emissions by putting a price on carbon, which constitutes a carbon market. The design is a cap and trade system, limiting the total volume of GHG emissions specific industrial establishments can emit. The EU ETS includes approximately 10,000 companies covering the sectors of electricity and heat generation, energy-intensive industries, and commercial aviation in 31 countries (27 EU member states plus Iceland, Norway, and Liechtenstein). Overall, the EU ETS covers around 40% of the EU’s GHG emissions.

This system also follows the polluter pays principle, meaning that pollution costs are the responsibility of those who create it. The industrial establishments covered under the EU ETS receive or buy pollution permits, called European Union allowances (EUAs). For each allowance, they can emit 1 tonne of CO2. However, the overall cap gets reduced each year, meaning fewer allowances are available and, therefore, a reduction in emissions over time.

Effort Sharing Regulation (ESR)

ESR is another of Europe’s main tools to combat climate change and reduce GHG emissions in the sectors outside the Emissions Trading System (ETS). Under the ERS, the EU-wide GHG reduction effort gets shared between all the EU Member States based (primarily) on GDP per capita. The ESR sets a target for each member state to cut gas emissions in sectors not currently covered by the ETS, which now represent 60% of Europe’s emissions. These sectors are road transport, agriculture, buildings, small industries, and waste.

Land Use, Land Use Change or Forestry (LULUCF)

Cutting emissions is not the only way to achieve climate neutrality. For example, removing CO2 from the atmosphere by capturing it in soil and forests also reduces the EU’s total GHG emissions, as forests absorb 10% of total EU GHG emissions yearly. And so, the LULUCF Regulation implements that all sectors should contribute to the EU’s 2030 emission reduction target, including the land use sector. The Regulation states that whatever emissions from land-use sources are reported (per individual Member State), an equivalent must be removed through LULUCF; this is called the “no debit” rule.

Although Member States already partly undertook this commitment individually under the Kyoto Protocol up to 2020, the Regulation enshrines the commitment for the first time in EU law for 2021-2030.

So, What is the European Green Deal?

According to the European Commission, the European Green Deal “transforms the EU into a modern, resource-efficient and competitive economy, ensuring no net emissions of greenhouse gases by 2050, economic growth decoupled from resource use, and no person or place being left behind.” The package covers climate, environment, energy, transport, industry, agriculture and even sustainable finance – all of which are strongly interlinked. With the European Green Deal, the EU ultimately aims to be climate-neutral by the middle of this century.

But there is a number sitting at the core of the Green Deal: 55. And that is because the EU’s climate, energy, transport and taxation policies must be fit for reducing net greenhouse gas emissions by at least 55% by 2030. And here, POW EU knows a little something. 

In 2020, the European POW community called for the EU to commit to a 65% reduction in carbon emissions by 2030 as part of our “Lead the way” campaign. While we – together with hundreds of other climate organisations – managed to push the European Parliament to adopt a 60% reduction goal, in the end, EU leaders only raised the target to 55%. Still, the legislative proposals for how to hit that 55% target and make Europe ‘Fit for 55’ are big, as it makes us the first continent to convert talks about climate neutrality into a comprehensive set of tangible laws and regulations.

Five Big Takeaways to Remember From the European Green Deal

The ‘Fitfor55’ package is ultimately a set of proposals to revise climate, energy, and transport-related legislation, and adopt legislative initiatives to align EU laws with climate goals. You can find comprehensive legislation lists on the Concilium.europa.eu website. But, to save you the headspace, here are some of the most important items on the agenda:

Carbon Pricing

Increasing carbon prices will make it more expensive for dirtier industries to keep emitting carbon under the European Emissions Trading System (ETS). Moreover, member states will be required to spend all the revenues they get from the Emissions Trading System on climate action (right now, it is recommended that they spend 50% of it on climate). To ensure companies don’t turn towards cheaper, less regulated imports such as steel or concrete from non-EU countries, a Carbon Border Adjustment Mechanism will also be implemented. Essentially, a carbon tax at the border is set to go into effect in 2023.

In parallel, a new emissions trading system will be set up and applied to the fuel producers supplying buildings and road transport. And to counteract concerns that this will hit the less well-off hardest, a Social Climate Fund will help people pay for energy efficiency upgrades to their homes and to purchase greener cars.

Green Transport

Transportation is the second biggest contributor to the EU’s carbon footprint after energy, accounting for nearly a quarter of all emissions. It is also the main source of emissions from outdoor enthusiasts. That is why the package calls for a proper overhaul of energy taxation to phase out the tax breaks currently enjoyed by the aviation and shipping industries. If you’re looking for ways to reduce your transport carbon footprint, check out our POW EU’s transport hub. Here you find information to help you choose a low-carbon transport option for everyday travel and reduce one of the biggest impacts the outdoor community has on our climate and planet.

Combustion Engines

The shift to electric vehicles has accelerated on the roads, with 2035 as the deadline when all new cars must be zero-emission. And no more worrying about running out of battery: the Alternative Fuels Infrastructure Directive will help drive a massive expansion of charging infrastructure with a target to have charging stations every 60 kilometres.

Energy Efficiency

Energy efficiency is another big focus. Some three-quarters of buildings in the EU are energy inefficient, which is why one requirement from the Energy Efficiency Directive is for the Member States to renovate 3% of their public buildings yearly to run on renewables.

Nature (land-use and forestry)

The EU has recognised the need for more urgent atmospheric carbon removal through rebuilding the carbon sinks we have lost. The Regulation on Land Use, Forestry and Agriculture has set an overall EU target for carbon removals by natural sinks. It will require the Member States to do their share and expand their carbon sinks, amongst other things, by chipping in to plant three billion trees across Europe by 2030.

What Happens Next?

At the end of June, the Council adopted its negotiating positions (general approaches) on five legislative proposals in the ‘Fitfor55’ Package, most of which we covered in this post:

– EU emissions trading system (EU ETS)
– effort-sharing between member states in non-ETS sectors (ESR)
– emissions and removals from land use, land-use change and forestry (LULUCF)
– social climate fund (SCF)
– new CO2 emission performance standards for cars and vans

This update is just the latest in an active timeline of updates that have been ongoing since 2019. Unfortunately, a lot still needs to happen before any legislation passes and becomes law, but we will get into that in a later blog post. 

Looking for More?

For even more details on how the climate crisis affects your area of Europe, check out the “Climate Change and Adaptation” brief by the European Environmental Agency.

Find out more about the deadly effects of heatwaves here in Europe in this article by Euro News.

Here is more on the EU Emissions Trading System. Or, if you are more of a visual learner, check out this EU Climate Action video.