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25th Feb 2024

Von der Leyen promises Green Deal will be 'true recovery'

  • 'Carbon must have its price because nature cannot pay the price anymore': EU Commission president Ursula von der Leyen in her first State of the Union speech (Photo: European Parliament)

The president of the European Commission, Ursula von der Leyen, promised on Wednesday (16 September) that the Green Deal will lead the investment plan needed in Europe for a future-orientated "true recovery".

"We have more proof that what is good for the climate is good for business and is good for us all," von der Leyen said in her first State of the Union speech - where she announced an increase in the existing 2030 emission-reduction target, from 40 percent to 55 percent, compared to 1990 levels.

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"There is no more urgent need for acceleration than when it comes to the future of our fragile planet," she added.

However, the head of the EU executive also acknowledged that her proposal would divide member states, who have previously expressed concerns about their different domestic starting positions.

But the German commission chief warned that the Green Deal involves much more than cutting emissions.

It is a "cultural project," she said, pointing out the need to make the EU's food, energy, mobility and production systems, as well as consumption patterns and lifestyles, more sustainable.

By next summer, Brussels aims to revise all climate-and-energy-related legislation to make it "fit" for the new 2030 goal.

While the new 2030 goal represents a considerable strengthen of the previous target, some MEPs and environmental NGOs consider the new target is still not aligned with the Paris Agreement and the 2050 climate-neutrality target.

"It is good to see that you set out a higher emission-reduction target. This is a step forward. Even though we know that from a scientific point of view, 55 percent will not be enough," said the leader of the Greens in the parliament, Ska Keller.

"The climate cannot be negotiated with, so better we move quick," she added.

This week the commission's proposal came under attack for including carbon sinks (as provided by soils and trees) in its emissions-reduction goal, turning the existing emissions target into a "net" emissions target - a move NGOs described as an "accounting trick".

Meanwhile, von der Leyen said that 30 percent of the €750bn recovery fund would be financed with green bonds - where proceeds are used for environmental projects - making the EU the world's largest issuer.

Liberal MEP Pascal Canfin told EUobserver earlier this week that "this [move] would not only contribute to significantly boost the green bonds markets globally, but it will also strengthen the role of the union as a global trendsetter for green finance".

'Can't negotiate with climate'

The green bond market has exploded in recent years - but it still constitutes only 3.7 percent of the total global bond issuance.

In early 2021, the commission will put forward EU green bonds standards, setting out clearly which assets and projects the money can be used for.

The building, together with transport and industry, is one of the sectors that generate more emission in Europe.

To green the building sector, von der Leyen wants to launch a 'European Bauhaus', a co-creation space where architects, artists, students, engineers, and designers can collaborate.

Experts estimate that the EU-wide energy renovation needed, mostly in residential buildings, would cost €200bn a year for the next 30 years.

However, according to the commission chief, "the construction sector can even be turned from a carbon source into a carbon sink if organic building materials like wood and smart technologies like artificial intelligence are applied".

'Carbon has a price'

Next year, the commission also wants to put forward a "carbon border-adjustment mechanism" for selected sectors, as a part of its Green Deal.

This instrument would allow the EU to protect Europe's economy and industry against carbon-emitting competitors from outside the bloc while increasing its 'own resources' - Brussels' terminology referring to money that the EU itself directly collects.

"We must insist on fairness and a level playing field and Europe will move forward - alone or with partners that want to join," warned the commission chief, who added that "carbon must have its price because nature cannot pay the price anymore".

In total, over one-third of the recovery fund will be spent on environmental projects, although the long-term EU budget is set to keep funding fossil fuels.

On Tuesday, MEPs from the parliament's environment committee agreed to allow financing of investments in gas projects from the Just Transition Fund - which aims to support fossil fuel-dependent regions to green their economies.

NGOs and industry representatives have been demanding the exclusion of fossil-fuel financing under the fund, arguing that investments in clean energies can create three times more jobs.

MEPs agreed that only member states that have adopted a national objective on the 2050 climate-neutrality target can access to the fund - which could force Poland to uphold the bloc's climate commitment.

Finally, green groups warned on the gaps between von der Leyen's rhetoric and the EU's climate action regarding, for example, the much-needed reform of the Common Agriculture Policy or the use of novel technologies to decarbonise industry.

EU's chance to be world's biggest green-bond issuer

The European Commission is now considering issuing 'green bonds' for the first ever time, after green groups and other critical voices called for the unprecedented commercial-markets debt to be used on environmental projects.

EU's new 2030 climate target slammed on 'accounting trick'

The EU's updated 2030 climate-target plan, due to be presented by the European Commission, have been criticised for including land and forest carbon sinks in its emissions-reduction goal. Green groups describe it as an "accounting trick".

EU climate law: MEPs want EU to be more ambitious

Members of the European Parliament's environment committee on Thursday will vote on a crucial report about the new EU climate law. Lead rapporteur MEP Jytte Guteland expects that most MEPs will support at least 60-percent target for 2030.

Higher EU climate target 'economically feasible'

A new report indicates that the EU's plan to reduce the bloc's greenhouse emissions by 55 percent by 2030 is "technically and economically feasible" - with a reform of EU carbon market and "adequate safeguards" for low-income EU countries.

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