The European Union executive has introduced a dozen new laws aimed at curbing carbon pollution, raising renewable energy targets, plant three billion trees, and cut the continent’s greenhouse gas emissions 55% by the end of a “make-or-break decade” for climate and biodiversity.
It could be years before the “sweeping” new measures in the “Fit for 55” package are negotiated and finalized by the EU’s 27 member countries, multiple news outlets reported this week.
“By acting now we can do things another way” and “choose a better, healthier, and more prosperous way for the future,” said European Commission President Ursula von der Leyen. “It is our generational task…[to secure] the well-being of not only our generation, but of our children and grandchildren. Europe is ready to lead the way.”
“Yes it is difficult, yes it is hard. But it’s also an obligation,” agreed EC Vice President Frans Timmermans, the commission’s lead on the European Green Deal. “Because if we were to renounce our obligation to help humanity live within planetary boundaries, we would fail not just ourselves but we would fail our children and our grandchildren, who in my view, if we don’t fix this, will be fighting wars over water and food.”
The Guardian says centrepieces of the plan include:
• A 40% renewable energy target by 2030, up from the previous goal of 32%;
• A carbon pricing system with “social compensation” for those who need it;
• Tighter controls on industrial emissions through the EU’s Emissions Trading Scheme;
• A controversial move to extend the continent’s emissions trading system to buildings and vehicles by 2025;
• A ban on new internal combustion vehicles by 2035, with vehicle emission reduction targets set at 55% by 2030 and 100% five years later;
• Binding energy efficiency and building retrofit targets, aimed at upgrading 3% of public buildings per year;
• Faster installation of recharging and refuelling infrastructure for non-fossil fuel vehicles, with a target of locating charging points every 60 kilometres for electric vehicles and every 150 kilometres for hydrogen refuelling;
• Emissions trading requirements for aviation and shipping, a tax on aviation fuel, and a sustainable fuels mandate for air and sea ports;
• Better protection for the continent’s older forests; and
• A “carbon border adjustment mechanism” on polluting imports like steel, aluminum, and fertilizer.
“Turning those headline-grabbing numbers into enforceable regulations requires intricate negotiations among the EU’s 27 member states,” Bloomberg Green reporter Laura Millan Lombraña cautions. “Brussels-watchers know what to expect, but the rest of us are advised to exercise patience. As talks advance, it’s important not to let the myriad technicalities obscure the big picture—that humans need to cut greenhouse gas emissions by half by the end of the decade and reach net-zero by mid-century to forestall a level of temperature rise that would be catastrophic for all living beings on Earth.”
But Lombraña says the package will still trigger a “market-led revolution” that will “impact every single thing you can think of”, with natural spaces like forests and grasslands and a just transition for all taking centre stage.
Bloomberg’s Alastair Marsh adds that the plan could force investors to “to view global warming less as a distant menace and more as an imminent threat,” with one analyst predicting “significant ramifications for money managers” who will now have to pay attention to the near-term financial impacts of the climate emergency.
“It brings a discussion that felt quite distant into something that is tangible and will happen in this decade,” said Daniel Klier, CEO of ESG data company Arabesque S-Ray. “It brings what for many people was a conversation about the world in 2050 to something that will actually translate into real profit and loss impact within the next five years.”
“What the EU is saying is, we recognize that a really, really big problem is coming, and coming rapidly, and we need to do something huge; we need to pull on some really big levers,” added Andrew Jackson, head of fixed income at Federated Hermes. “That signals to me they will use the markets to fund a lot of this, and that’s supportive of markets more generally.”
Globe and Mail finance reporter Jeffrey Jones says the plan “serves notice to the world” that the EU “is looking to spark an emission reduction arms race as global climate talks draw near.” And “if Europe is setting a bar with its measures, Canadians should prepare for much bigger changes to its economy and trade relationships than have already been forecast.”
European climate campaigners saw less to celebrate in the plan.
Friends of the Earth Europe energy poverty campaigner Martha Myers said the package is “unfit for the just energy transition that people and the planet desperately need,” adding that the EC’s “move to extend emissions trading to buildings shows a lack of solidarity. It throws low-income people into high-energy price waters while offering only a swimming float of support to relieve energy poverty.”
“What the Commission says is ‘Fit for 55’ is unfit for our planet and unfair to society,” agreed Barbara Mariani, policy manager for climate at the European Environmental Bureau. “Without a fossil fuel phaseout, the fuel industry will pass on emission costs for buildings and transport to citizens and still keep making immense profits.”
The “most relevant EU green policy dossier of the year not only fails to provide climate-neutral roadmaps and sector-specific targets, but also continues to shield EU industry from paying the full cost of pollution,” the Bureau wrote this week. “Introducing an Emissions Trading Scheme for buildings and transport while maintaining free CO2 allowances for industry and using public funds to finance fossil fuels in Europe will de facto shift the cost of pollution from the actual polluters to the final consumer,” and the plan also excludes high-emitting sectors like heavy industry and agriculture.
“Celebrating these policies is like a high-jumper claiming a medal for running under the bar,” said Greenpeace EU director Jorgo Riss. “This whole package is based on a target that is too low, doesn’t stand up to science, and won’t stop the destruction of our planet’s life support systems.”
In two separate releases, Transport & Environment said the plan will make emissions-free vehicles accessible to all and push the shipping industry toward cleaner fuels, but risks locking in shippers’ use methane-heavy natural gas.
“The World Bank, IEA, shipyards, and shipowners now recognize the pivotal role of green hydrogen in decarbonizing shipping,” said T&E shipping program director Faig Abbasov. That leaves the European Commission as “the only major institution still recklessly pushing the industry to invest in LNG ships that will lock us into decades of further pollution and stranded assets.”
The politics within the EU are a whole other issue. Before Fit for 55 was even released, “the plans triggered serious infighting at the European Commission, the bloc’s administrative arm, as the final tweaks were being made,” BBC writes, citing Agence France-Presse. “Opposition is also expected from some industry leaders, such as airlines and vehicle manufacturers, as well as from eastern member states that rely heavily on coal.”
Ultimately, “the success of the package would rest on its ability to be realistic and socially fair, while also not destabilizing the economy,” BBC adds. “The aim is to put the economy on a new level, not to stop it,” one EU diplomat told Reuters.
And sure enough, the BusinessEurope lobby group said the plan “risks destabilizing the investment outlook” for industries like steel, cement, aluminium, fertilizers, and electric power “enormously”, BBC writes. Willie Walsh, CEO of the International Air Transport Association, added that “aviation is committed to decarbonization as a global industry. We don’t need persuading, or punitive measures like taxes to motivate change.” [That’s after more than a decade of resisting and lobbying against precisely those changes—Ed.]