Sunday

1st Oct 2023

Opinion

How to recover from corona without choking the planet

  • Questionable whether EU agreement paves the way to climate neutrality by 2050. (Photo: Windgeist)

First and foremost, do no harm - how to ensure an economic recovery without environmental losses

The danger of a rebound in greenhouse gas emissions after the coronavirus crisis is looming on the horizon. We need to design effective measures to avoid this.

Read and decide

Join EUobserver today

Become an expert on Europe

Get instant access to all articles — and 20 years of archives. 14-day free trial.

... or subscribe as a group

With emission budgets rapidly shrinking, the current decade is crucial for fighting climate change.

Yet, we need to learn another lesson from the financial crisis of 2009 and prevent history from repeating itself: an uncontrolled post-crisis increase in greenhouse gas emissions.

From a financial point of view, things look good at first glance: on 21 July, the European Council agreed on a recovery package of €750 billion and the next Multi-annual Financial Framework (MFF) of €1,074 billion.

The Recovery and Resilience Facility, worth €672.5 billion, will be the central point of the EU's recovery efforts.

The European Council agreed on an overall climate spending target of 30 percent, possibly triggering climate investments of €322 billion under the next MFF 2021 and 2027 and €225 billion under the EU recovery programs.

However, if we merely scratch the surface, it becomes questionable whether this agreement paves the way to climate neutrality by 2050.

The European Commission has estimated that achieving the current 2030 climate and energy targets will require an additional annual investment of €260 billion. Other estimates assume those targets would require investments of €175 to €349 billion annually.

Moreover, the proposed higher 2030 targets would further increase investment needs. According to Bruegel, a Brussels-based think tank, a target of reducing greenhouse gas emissions by around 50-55 percent by 2030 would require additional investments of around €300 billion a year.

These estimates suggest a significant investment gap, possibly exceeding €1600 billion for the next MFF timeframe or €2,000 billion for the next decade. This is yet another reason why we should be paying particular attention to the effectiveness of spending.

Next to the funding gap, there are other uncertainties whether the Recovery and Resilience Facility will support climate goals.

As a general principle, the European Council agreed that all EU expenditure should be consistent with the Paris Agreement's objectives and should do no environmental harm.

EU expenditures must also comply with the objective of EU climate neutrality by 2050 and the EU's new 2030 climate target. These are important statements but how can they make a difference in real terms?

How not to harm?

To make the "do no harm" principle effective, the EU recovery package should be built on clear criteria and be linked to the standards of the proposed Just Transition Fund: the fund may not support "investments related to the production, processing, distribution, storage or combustion of fossil fuels".

The EU taxonomy regulation can also help to give teeth to the "do no harm" principle.

With these requirements in mind, the Recovery and Resilience Facility should explicitly not be used to fund investments in any type of coal, oil, or gas infrastructures unless funding is aimed at adapting existing natural gas transmission infrastructure to the transmission of hydrogen.

In short, recovery funding should not be eligible for investments that are incompatible with the 2050 climate neutrality objective.

For now, however, the European Council has made no reference to the EU taxonomy regulation.

It only agreed to adopt "reliable criteria for classifying such expenditure", called for an "effective methodology" for monitoring climate spending, and requested an annual report from the European Commission on climate expenditures.

This does not suffice if we want to avoid a similar aftermath as that of the 2009 financial crisis - an emission-intensive economic recovery.

Today, we are given the very last real opportunity to pave the way for sustainable economic development and meeting climate neutrality - an opportunity that should not be wasted.

Author bio

Michał Dorociak and Michał Kamiński work for 300Gospodarka, a think-tank in Warsaw, and Nils Meyer-Ohlendorf is from the Ecologic Institute, a think-tank in Berlin

Disclaimer

The views expressed in this opinion piece are the author's, not those of EUobserver.

Why EU beats US on green pandemic recovery

The United States recovery focused on a number of important issues, including unemployment benefits and funding for health care providers, but lacked any programs directed towards addressing pollution, renewable energy industries, and clean technology improvements.

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.

Poland's coal phase-out 'feasible' by 2035

Poland's coal phaseout should take place by 2035 if the government does not interfere, according to a new report by environmental group Greenpeace Polska.

EU unveils Covid-19 'colour-code' travel zones

The European Commission has unveiled recommendations, including common criteria for member states on coronavirus epidemiological risks and harmonised 'colour-coding' of risk regions.

Punish Belarus too for aiding Putin's Ukraine war

While Belarus has not sent its own troops to fight Russia's war in Ukraine, the Minsk dictatorship has been heavily involved. As a result, Belarus must be punished for its involvement — what can the world do to sanction Belarus?

How do you make embarrassing EU documents 'disappear'?

The EU Commission's new magic formula for avoiding scrutiny is simple. You declare the documents in question to be "short-lived correspondence for a preliminary exchange of views" and thus exempt them from being logged in the official inventory.

Column

Will Poles vote for the end of democracy?

International media must make clear that these are not fair, democratic elections. The flawed race should be the story at least as much as the race itself.

Latest News

  1. EU women promised new dawn under anti-violence pact
  2. Three steps EU can take to halt Azerbaijan's mafia-style bullying
  3. Punish Belarus too for aiding Putin's Ukraine war
  4. Added-value for Russia diamond ban, as G7 and EU prepare sanctions
  5. EU states to agree on asylum crisis bill, say EU officials
  6. Poland's culture of fear after three years of abortion 'ban'
  7. Time for a reset: EU regional funding needs overhauling
  8. Germany tightens police checks on Czech and Polish border

Stakeholders' Highlights

  1. Nordic Council of MinistersThe Nordic Region is stepping up its efforts to reduce food waste
  2. International Medical Devices Regulators Forum (IMDRF)Join regulators, industry & healthcare experts at the 24th IMDRF session, September 25-26, Berlin. Register by 20 Sept to join in person or online.
  3. UNOPSUNOPS begins works under EU-funded project to repair schools in Ukraine
  4. Georgia Ministry of Foreign AffairsGeorgia effectively prevents sanctions evasion against Russia – confirm EU, UK, USA
  5. International Medical Devices Regulators Forum (IMDRF)Join regulators & industry experts at the 24th IMDRF session- Berlin September 25-26. Register early for discounted hotel rates
  6. Nordic Council of MinistersGlobal interest in the new Nordic Nutrition Recommendations – here are the speakers for the launch

Stakeholders' Highlights

  1. Nordic Council of Ministers20 June: Launch of the new Nordic Nutrition Recommendations
  2. International Sustainable Finance CentreJoin CEE Sustainable Finance Summit, 15 – 19 May 2023, high-level event for finance & business
  3. ICLEISeven actionable measures to make food procurement in Europe more sustainable
  4. World BankWorld Bank Report Highlights Role of Human Development for a Successful Green Transition in Europe
  5. Nordic Council of MinistersNordic summit to step up the fight against food loss and waste
  6. Nordic Council of MinistersThink-tank: Strengthen co-operation around tech giants’ influence in the Nordics

Join EUobserver

Support quality EU news

Join us