13th Aug 2022

MEPs vote to reject green label for gas, nuclear

  • 'Yes!!' Bas Eickhout tweeted shortly after the rejection vote (Photo: euranet_plus)
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Lawmakers from the environment and economy committees on Tuesday (14 June) voted to reject a European Commission plan proposed in February to label certain gas and nuclear energy projects as sustainable investments until 2030.

"Taxonomy objection carried! 76 in favour, 62 against, and four abstentions. Yes!!," Green MEP Bas Eickhout tweeted shortly after the vote.

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A longtime opponent, he has been a driving force behind a cross-party coalition of left-wing, centre-left, greens, liberals and far-left MEPs who argue there should be no place for gas and nuclear energy projects in the EU's so-called Taxonomy for Sustainable Investments.

A final vote will be cast during the plenary in Strasbourg in July, but it is still unclear if the taxonomy will be rejected.

At a Monday event, Greens MEP Michael Bloss said that the margins are too close to call.

In response, commission spokesperson Daniel Ferrie said the inclusion of gas and nuclear as green investment is "important" because it can be used as a tool to decarbonise.

But this claim has been denied by the commission's own scientific advisory body in the past.

"It will heavily damage the credibility of the taxonomy, and I recommend MEPs to reject it," Sebastian Godinot said in a parliamentary hearing in May.

He also pointed out credit rating agencies like Moody's and Standard and Poor also exclude gas and nuclear projects from their green ratings.

"The current EU taxonomy will do worse than current [private sector] green bond standards," he said.

Investors see the taxonomy as the gold standard that will define what is green for each economic activity, down to grams of CO₂ per production unit.

Commercial investors and public authorities worldwide can use the 414-page rule book to determine their investment strategies and ensure that they align with the EU's emissions reduction targets and environmental do no harm principle.

In an upset decision, the commission, following months of heavy lobbying from nuclear-reliant France and gas-reliant eastern European countries, decided to include gas and nuclear energy projects which exceed the green guidelines set out in the taxonomy.

Hartwig Liesch, chief investment officer at the Dutch Pension Fund, said in the parliamentary hearing that the inclusion is "not helpful" because it dilutes the meaning of green investment, making it more complex.

In January, EIB director Werner Hoyer said at the bank's annual media conference that the complexity of proposed rules left investors feeling "drowsy."

Key MEPs ready to vote on 'green' label for gas and nuclear

MEPs from the environment and economy committees will vote on a resolution objecting to European Commission plans to classify gas and nuclear energy projects as sustainable investments until 2030 — with tight results likely.

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