EU plans on climate change are currently colliding over the rising cost of emissions

Brussels ’historic attempt to tackle climate change makes it a wall of opposition from bloc governments for the fact that their plans touch their families with higher energy costs.

EU lawmakers have told the Financial Times that the European Commission’s attempts extending carbon prices to the largest polluting sectors of the economy as cars and buildings are in danger, as member states opposed it forcing their poorest to pay.

Frans Timmermans, executive vice president of the commission in charge of the Green Deal, said the measures were necessary to “put a price on carbon, and a premium for decarbonization.”

“Our current tools don’t do enough. If we do not fight the climate crisis, we will be fighting wars for water and food, ”he said.

Brussels presented Wednesday 13 legislative measures designed to help reduce average greenhouse gas emissions by 55 percent by 2030 and to reach zero net emissions by 2050, compared to 1990 levels.

The core of the strategy is a test to expand the EU’s carbon tariff mechanism, known as the Emissions Trading System, where companies have to pay for the cost of pollution.

Governments of some of the largest states have lined up to question the merits of expanding the system to cover emissions from road transport and building heating, arguing it will have a “regressive” effect. on those residents who can’t easily afford greener alternatives.

Since its inception in 2005, the deductible system has been limited to large energy generators and polluting industries that purchase credits to cover the cost of their emissions.

The price of carbon in the EU has soared last month to around € 55 a tonne, or more than double its pre-pandemic level, as traders speculate that the availability of carbon quotas should be restricted if ‘The EU must meet its emission targets.

But France, Spain, Italy, Hungary, Latvia, Ireland and Bulgaria have raised concerns about the impact on citizens at a meeting of EU ambassadors Wednesday when they were briefed after the plans were released, diplomats said. at FT.

The chairman of the commission, Ursula von der Leyen, also faced a revolt among at least seven of its 26 commissioners before presenting the plans. Reforms will need the support of a qualified majority of EU governments and the European parliament to enter into force.

A former EU diplomat said the ETS expansion could be abandoned, despite it being positioned next to a proposed € 72 billion fund to help alleviate energy poverty.

Tortuous negotiations are underway on the package, starting in the coming months and scheduled to continue until 2023. Content policies include a ban on the sale of new diesel and gasoline vehicles by 2035, the introduction of a kerosene tax for aviation, and a boundary tax. on imports based on their carbon content.

The so-called social climate fund has also met with resistance from “frugal” northern countries such as the Netherlands where there is opposition to a greater redistribution of funds in the bloc. “If the fund is scrapped, the logic behind the new ETS will disappear,” the diplomat said.

The opposition has forced the commission to delay plans on the use of money generated by the carbon market and a border tax to repay EU debt that was scheduled for next week, officials said. .

Germany and Denmark are among the countries supporting the ETS expansion, which Brussels says is necessary to accelerate the decarbonisation of transport and buildings where emissions have been steadily growing over the last 20 years. Germany has been testing a national coal market for cars and buildings since the beginning of the year.

Dan Jorgensen, Minister of Climate in Denmark, said that ETS has already shown success in reducing emissions from industry and should be expanded. “We know there are pitfalls, and we need to be careful that the system triggers reductions instead of the other way around,” he told FT.

Pascal Canfin, French MEP and head of parliament’s environment committee, said the measure risked hampering the message behind Europe’s climate boost in the eyes of citizens. “I support the package but go ahead.” [the ETS] the narrative has become about the imposition of new taxes. It’s a real pity. “

France will have to play a central role in the main negotiations of the exceptional green package that Paris will assume the rotating EU presidency next year, coinciding with the presidential election.

The government of Emmanuel Macron, which has supported the EU’s climate goals, has warned consumers to face the kind of energy price increases that have sparked the yellow vests protests against the government.

Canfin said the election would mean that the presidency of the French council “cannot give the green light to a measure that is deeply contrary to what we want to see”.

A French official said on issues such as heating “people have no immediate alternative – they can’t change boilers from night to evening. Which seems really important to us, because of the experience of the yellow vests, is to have a way to help people through change. ”

More information from Sam Fleming in Brussels is Victor Mallet in Paris

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