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29th Mar 2024

EU finance chiefs want say over climate change deal

In their first discussion about the EU's proposed climate change policies, the bloc's finance ministers have warned that they should focus on market-based and cost-effective instruments, as well as global rather than regional solutions, which could hamper Europe's competitiveness.

Finance chiefs from the 27 EU member states meeting in Brussels on Tuesday (12 February) said that although the envisaged policy package would have serious economic and fiscal implications, "the costs of action at the global level – at up to three per cent of global GDP by 2030 – are estimated to be far lower than the costs of inaction."

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  • EU finance ministers said that saving energy is still the cheapest way of preventing climate change (Photo: European Commission)

However, it can be only achieved "as long as both global solutions and cost-effective measures are implemented," ministers said in a statement.

They were referring to the measures outlined by the European Commission earlier this year as a way for the EU to fulfil the goals it set itself to reduce global warming.

Last year, EU leaders agreed that by 2020 there should be a 20 percent cut in CO2 emissions compared to 1990 levels, that 20 percent of energy should be produced from renewables and that there should be a 20 percent boost in energy efficiency.

The package is due to be discussed at a high-level summit in March, with Tuesday's ministerial session seeking to stress that the full costs of any agreed policies should be worked out and taken into account ahead of any decisions on the issue.

The finance ministers argued that the "market-based policy instruments such as the Emission Trading Scheme (ETS) and environment taxes" are of key importance, as they deliver the "lowest cost policy options for meeting energy and climate change targets."

They also suggested that while finance ministers should be part of the decision-making on any EU decisions regarding climate change with "significant budgetary implications," the bloc should leave it up to member states to deal with some areas.

In particular, "revenues from auctioning [within the ETS] should be used in line with sound budgetary principles and, specifically, not be subject to mandatory earmarking or hypothecation at EU level," the ministers stated.

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