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‘Ambitious’ EU Climate Law aims to reduce GHG emissions 55% by 2030

21 April 2021 Cristina Brooks

At 5 am on 21 April, after a night of negotiations, the EU's governing bodies reached a provisional agreement on the European Climate Law, four months after every member state but Poland agreed to an earlier deal.

The political compromise is now set to be put into legal language. It will set a series of milestones on the road to climate neutrality by 2050. Under the law, the EU's intermediate target of reducing net GHGs from their 1990 levels by at least 55% in 2030 compares with 40% under current rules.

The law will attempt to align with the EU's Paris Agreement target, submitted in December. It now moves to an EU member state representative body that ensures policy consistency, COREPER, and then back to the European Parliament, for approval and adoption in two to three weeks.

European parties officially backing the law include the center-right European People's Party, Socialists & Democrats, and liberal Renew Europe.

Officials leading negotiations saw it as a success in light of an upcoming US-hosted climate summit taking place on 22-23 April. "Europe… will be the first continent in the world [agreeing] to be climate neutral by 2050. It is also a strong message to the world, that will be important, two days before the Biden conference on climate," said Portuguese Minister João Pedro Matos Fernandes at a virtual press conference.

Despite the new 55% target, the law has been criticized for undershooting a target of reducing net emissions by 60% or more by 2030, supported by the EU Parliament in a text adopted in October, in line with the European Greens and European Free Alliance party.

But some of those in the European Parliament that had originally backed the 60% target have said on social media they are satisfied with the compromise. The 55% is considered 57% by some calculations by, for example, the European Parliament's rapporteur on the Climate Law, Jytte Guteland.

Controversially, the 57% reduction figure includes a specific amount of negative emissions from natural and manmade carbon sinks, such as agricultural land and forests.

The EC will revise its regulations on land use to raise EU carbon sinks to levels above 300 million mt CO2 equivalent by 2030, which would "de facto correspond to a 2030 reduction target of 57%," the EU Parliament said in a statement.

Prior targets had included all the sinks, and if the EU were to have counted all of the carbon sinks again in the new target, it would only have needed to reduce emissions by 52.8%, according to a report by the Green Party's shadow rapporteur on the Climate Law, Michael Bloss.

The proposed regulation will also create an independent advisory board, taking after similar climate advisory bodies in France and the UK, consisting of a rotating panel of 15 senior national experts, with no more than two members from the same country, to keep track of progress towards the climate target.

While there was near-unanimous approval for the creation of a climate board, environmental groups such as CAN Europe and Greenpeace criticized the target.

Some observers say the law is good -- considering the context. "I know the parliament and some environmental groups wanted something more ambitious. I think it is. If you look at the details, it is going to be quite difficult for the European Union as a whole to achieve these targets. So, I consider them to be quite ambitious," Cambridge University Centre for European Legal Studies' Markus Gehring said in an interview with IHS Markit.

The use of climate sinks is not the creative accounting green groups have claimed, Gehring said. "I think it's well done. You can reserve carbon stocks that are bound up in forestry over the long term, then it makes good sense to also include what historically were called 'LULUCFs' and the EC said they were going to reform the legislation on these carbon sinks inside the EU. I don't see that as a major danger to the reduction targets, and I don't think it's an accounting trick," he said.

Diesel vehicles

The agreement is binding for the 27 member states, but each state will have a different commitment because Sweden and Finland, for example, aim to stop contributing to global warming much earlier, Chair of the Environment Committee of the European Parliament Pascal Canfin said in an interview with French radio.

Dependent on coal for 70% of its power, Poland was the only country not to fully agree to reach climate neutrality in December, but it has been given until June to confirm its approval and implementation, he said.

Canfin said the Climate Law would accelerate the deployment of renewable energy and put an additional price on the carbon paid by industries.

It was going to change, for example, the emissions standards for cars, so that by 2035 it will no longer be possible to sell gasoline and diesel vehicles. Sale of vehicles that run on diesel is already set to be banned in France by 2040, and the UK plans to ban it by 2030. "To give you an order of magnitude, we are going to go 2.5 times faster in reducing emissions of greenhouse gases in the coming decade than in the past decade," said Canfin.

But as for whether all this will be enough to make the EU Paris-Agreement-compliant, that assessment will have to wait until the detail of the law is published, said Gehring.

EU ETS and fuel

Another major impact of the law is empowering the EU to act on emissions in a wider range of regulatory activities than before, said Gehring.

"We had a few quasi-legislative targets for the EU Emissions Trading System (ETS) to reach a 40% reduction, and that was part of the climate regulations. Now, we get a general Climate Law, which covers all areas, and is economy-wide rather than just covering major emitters or certain installations, as are covered in the ETS," he said.

The fact that this is a law and not a directive also has legal implications. "Fighting climate change has always been more of a political kind of declaration. But the minute you make and adopt legal rules, that could be enforceable. It changes the character of the effort. And in my view, that is a really, really positive step that the EU is taking," Gehring added.

The Climate Law is also set to enter into force more quickly than the EU's directives: 30 days after publication, possibly as soon as June, Gehring said.

While a directive would require a transition period of two to four years, "this time, it doesn't need any implementation by the member states, and is valid as law," he added.

Adoption of the law will likely mean a tightening of the EU ETS to reach the new binding legislative target, lowering the bar on fuel emissions. This may empower the EU when it looks to curb emissions from fuel in certain sectors, like international aviation, vehicles, shipping, and heating for buildings, although road transport will be more difficult.

The law empowers the EU to move towards any of the options. "It is unlikely that the ETS would expand to individual cars or road transport in general. But there are discussions, and if it were to run risks, and not fulfill its legislative target, then I think all options would be on the table," said Gehring.

The EU might, with considerable difficulty, also follow the lead of France and Germany in regulating fuel used to heat buildings through the ETS. "The building, installation, and heat and electricity use in individual houses is something that the EU will have an eye on when moving forward," said Gehring.

Posted 21 April 2021 by Cristina Brooks, Senior Journalist, Climate & Sustainability, IHS Markit

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