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25th Sep 2021

Draft EU 'green recovery' plan amid clash over natural gas

  • Eight member states have defended natural gas in the transition towards climate neutrality, amid fears over the costs of renewables (Photo: Johannes Jansson/norden.org)

The European Commission's recovery plan from the coronavirus pandemic will give priority to building renovation, renewables and hydrogen as well as to clean mobility and waste management, according to a draft document seen by EUobserver.

"For climate change, there is no vaccine. This is why Europe must now invest in a clean future," commission president Ursula von der Leyen told MEPs earlier this month, when she promised to make the Green Deal the cornerstone of the EU's recovery plan.

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Following weeks of speculation and political infighting, the EU executive will announce this Wednesday (27 May) its recovery plan proposal - which will be funded by the bloc's long-term budget and EU recovery fund.

However, the European Parliament has already threatened to veto the proposal if MEPs are left out from designing and overseeing the EU recovery fund.

The draft of the 'green recovery' indicates that the commission wants to mobilise €91bn per year to reach, together with other sources of funding, €350bn annual investments and fund rooftop solar panels, insulation or renewable heating systems of buildings - although social housing, hospitals and schools will be given priority.

The commission also wants to boost sustainable transportation and smart mobility, investing in clean vehicles (a €20bn scheme), the roll-out of electric-charging spots across Europe plus cycling infrastructure, while financing the modernisation and digitalisation of rail infrastructure.

However, Greenpeace, WWF and other NGOs denounced any kind of public funding for carmakers and other polluting industries tied to green commitments.

The commission also expects the coronavirus crisis to change mobility habits "making reductions of shorthaul flights likely and a shift to high-speed train connections necessary".

Likewise, the recovery plan aims to digitalise and modernise the bloc's waste management and the farming sector to increase the EU's resilience and to lower EU's dependency on third countries.

However, key measures - such as targets for waste reduction for specific streams and the harmonisation of the EU's recycling model - are only expected in 2022.

Green vs Grey hydrogen

Meanwhile, the European solar and wind markets are projected to shirk by 20 and 33 percent this year respectively, due to the disruption caused by the coronavirus pandemic.

To expand renewable energy, the EU's executive is considering an EU tender scheme for renewable electricity projects of two years, plus €10bn additional support for member states co-financed with the European Investment Bank.

"Without sustained growth of the renewables market, there is no future for clean hydrogen in Europe while sustainable hydrogen technology has a critical role to play in decarbonising the economy," reads the draft document.

As a result, the commission intends to launch a "1 million tonne of clean hydrogen commitment" - although the production of green hydrogen (from renewable energy sources) is still significantly higher than that of grey hydrogen (from natural gas).

To do so, the commission will put forward a special tender scheme to support clean hydrogen production, and give priority to the fertiliser industry and refineries, where grey hydrogen could be replaced more easily.

'Stranded assets'?

Meanwhile, eight member states - Bulgaria, Czech Republic, Greece, Hungary, Lithuania, Poland, Romania and Slovakia - have defended the role of natural gas in the transition towards climate neutrality, amid fears over the massive investment required for renewables.

"When replacing solid fossil fuels, natural gas and other gaseous fuels such as bio-methane and decarbonised gases can reduce emissions significantly," reads the document seen by EUobserver.

Although natural gas helps countries to phase out coal power, methane emissions that occur across the entire fossil-gas supply chain contribute to 25 percent of the global warming experienced today.

Environmental activists warned central and eastern member states over greenwashing and future challenges.

"Continuing investing in gas infrastructure to transport loosely defined decarbonised or low carbon gases would be a waste of EU taxpayers money ending up in stranded assets," said Esther Bollendorff, coordinator at NGO Climate Action Network.

"Europe's future energy infrastructure planning gives an opportunity for sustainable economic recovery and accelerating the transition to climate neutrality with a complete phase-out of fossil gas by 2035," she added.

EU rift deepens as Commission sticks to €1trn recovery

The EU Commission said it is still aiming for a recovery initiative above one trillion euros to kickstart the pandemic-hit EU economy - after a German-French proposal called for a commonly-financed €500bn plan.

Agenda

Recovery plans unveiled This WEEK

Tough negotiations start this week on both the EU's recovery fund and its revised long-term budget, which are likely to determine the entire future of the bloc.

EU leaders back trillion-euro recovery plan

EU leaders agreed on the need for a fund to support the recovery of Europe's economy from the coronavirus pandemic, but disagreed on details. The commission will come with proposals tied to the new long-term EU budget.

EU Commission's green recovery criticised as 'brown'

The European Commission's €1.85 trillion recovery plan from the coronavirus crisis did not convince environmental NGOs, such as Greenpeace, which believes that the proposal fails to offer a truly 'green recovery' and alternatives to the existing economic model.

Opinion

Will Romania be EU's Green Deal laggard?

Of the €30bn allocated to Romania under the EU recovery fund, just four percent is slated to go to renewable energy and energy-efficiency. Despite the pressing need to decarbonise Romania's heat and power sectors, this is not an investment priority.

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