European Green Deal: the complete guide

European Green Deal: the complete guide

Where is Europe in its ecological transition? Summary on the Green Deal: towards decarbonisation and environmental preservation.

14/6/2022

European Green Deal or Green Pact for Europe: what is it? In this article, we give you an overview of its objectives, strategy and obstacles.

What are the objectives of the Green Deal?

To meet the challenge of ecological transition, Europe is presenting the European Green Deal, which aims to make the European economy modern, competitive and in line with environmental issues. To achieve this, the Green Deal is ambitious and socially just, with the following objectives

  • Become the first climate-neutral continent by 2050 (with an intermediate target of 55% reduction in GHG emissions by 2030 compared to 1990 levels).
  • Ensuring economic growth "decoupled from resource use".
  • Ensure a fair transition by "leaving no one behind".

In order to encourage and oblige European structures (private and public) to evolve in this direction, the Green Deal establishes a binding legislative framework, the progressive deployment of which aims to achieve the objectives by 2050 through :

  • the updating of certain regulations.
  • the introduction of new measures.

All economic sectors are covered by the pact, including transport, energy, agriculture, buildings and industries such as steel, cement, textiles and chemicals, and finance.

Why the green pact?

To put the Green Deal into context, let's look back at the following key dates:

  • 1997: COP3, the Kyoto Protocol is signed. To reduce emissions of six greenhouse gases by 5% between 2008 and 2012, compared to 1990.
  • 2015: COP21, the Paris Agreement is signed. To keep the rise in the average temperature of the planet well below 2°C compared to the pre-industrial era, if possible at 1.5°C. It also aims to achieve net zero emissions worldwide by the second half of the 19th century.Implementation: each country must report every five years on the measures it has put in place to reduce its GHG emissions, with the obligation to present increasingly ambitious actions from one cycle to the next.
  • 2019: Ursula von der Leyen is elected President of the European Commission by the European Parliament. Putting it into practice: before the end of the year, in November 2019, the European Parliament declares a state of climate emergency.

In the wake of these events, the European Commission is formalising the European Green Deal in December 2019. This pact, promised by Ursula von der Leyen during her campaign, unveils ambitious climate objectives and a timetable. It aims to set a binding legislative framework for Europe to comply with the Paris Agreements.

Who is funding the Green Deal?

To finance this transition, which covers all economic sectors, the EU plans to invest up to 1,000 billion euros. In order to mobilise such a budget, the EU wishes to facilitate public (EU and Member States' budgets) and private investments in the framework of its Green Deal, with the help of legislation and an attractive taxonomy for projects related to sustainable development. For the time being, the breakdown of the Green Deal funding is as follows

  • EU budget: €503 billion,
  • 279 billion (fund launched in 2021 to boost investment in Europe),
  • 25 billion (Emissions Trading Scheme, European carbon market),
  • 100 billion (funds to support socio-economically vulnerable territories in the face of the ecological transition),
  • National co-financing: €114 billion.
Credits: European Commission

Furthermore, in order to green European finance and bring new funds to the European ecological transition, the EU presented an action plan in 2018 on taxonomy. This aims to direct investments towards low-carbon activities in line with the ecological transition. It comes into force partially in 2022 and fully in 2023.

What is the Green Deal's growth strategy for Europe?

Source: European Commission

The European climate strategy is divided into sectors. Here is a short, non-exhaustive summary of the measures in the green pact.

Industries: Industrial strategy for a clean and circular economy

To achieve climate neutrality by 2050, preserve our natural environment and strengthen our economic competitiveness, our economy must be fully circular. Today it is still largely linear, with only 12% of secondary materials and resources being reintroduced into it." - Mr Frans Timmermans, Executive Vice President for the Green Deal

In order to move towards a sustainable model, Europe is focusing on a circular economy, which means implementing the following actions:

  • Make products more sustainable in the EU, make it a standard: repairability (add consumer indices), reuse, recycling.
  • Reducing waste:
  • Recovery of waste in the form of second-hand resources (e.g. in construction, battery manufacture, second-hand textiles, etc.),
  • Elimination of single-use items, replacement of plastic with biodegradable materials.

Transport: Sustainable and intelligent mobility

Today, 25% of the EU's emissions come from transport. In order to meet the desired GHG emission reduction trajectory, Europe is aiming for a 90% reduction in transport-related emissions.

By what means? By promoting the train, which alone is responsible for only 0.5% of travel-related emissions, with the aim of gradually replacing carbon-intensive modes of transport (aeroplanes, cars, road deliveries, etc.). This translates into the following ambitions:

  • Abolition of pollution rights for airlines (currently allocated through the ETS, which will be progressively replaced by the carbon tax at the borders),
  • End of the sale of internal combustion cars in 2035,
  • Development of a European rail core network and liberalisation of the network :
  • Promote the use of trains for journeys of less than 500 km, and night trains beyond that,
  • Connecting Europe Express: Increase interoperability between existing European networks, i.e. ensure transfer between 3 types of rails (there are currently 3 existing rail spacings in Europe),
  • Develop soft mobility in urban areas.

Energy: Clean, affordable and secure energy

72% of Europe's primary energy is of fossil origin. The energy transition envisaged by the EU is based on the substitution of these resources by decarbonised energy and on energy sobriety/efficiency policies. Among the objectives defined :

  • Making the energy system more circular: for example, recovering waste heat from factories to heat nearby houses.
  • Increase the share of renewable energy in the European energy mix: from 22% in 2018 to 40% green energy by 2030, 84% by 2050
  • In particular by exploiting 3% of the available maritime space for offshore wind power: from a current production capacity of 12 GW to 60 GW in 2030, and 300 GW in 2050,
  • Increase the share of green hydrogen in the European energy mix (today it constitutes 2% of European energy consumption).
  • Improving energy efficiency (e.g. through building insulation): the EU has set a target of reducing its final energy consumption by 1.5% each year between 2024 and 2030.
  • Electrify uses, as electricity is a secondary energy that can be "clean".

Agriculture: From farm to table

Agriculture contributed 10.3% of the EU's GHG emissions in 2019 (Eurostat). The EU strategy for the sector, known as "Farm to Fork", sets several targets:

  • Ensuring food security, while respecting global limits,
  • Ensuring access to healthy food and promoting sustainable consumption,
  • Reduce biodiversity loss (pesticides),
  • Increase the share of organic farming from 8.5% in 2019 to 25% in 2030,
  • Reduce pesticide use by 50% by 2030,
  • Reduce chemical fertilizers by 20%.

Biodiversity: Preservation and protection of biodiversity

According to estimates by the World Resource Institute, between 150 and 200 wild species disappear every day. In order to halt this decline in biodiversity and preserve the balance of existing ecosystems, the EU plans to :

  • Extension of protected areas (Natura 2000) to at least 30% of the EU's land area and marine area,
  • Reduction of pesticides (see paragraph on agriculture),
  • Allocate a significant budget for monitoring and measuring the progress of existing biodiversity actions,
  • Planting three billion trees across Europe by 2030.

Social impact: just transition mechanism

In order to "leave no one behind", the European ecological transition is endowed with a fund intended for the most vulnerable entities. 5 billion over the period 2021-2027 mobilised by the Just Transition Fund. It will benefit :

  • Citizens: to access re-qualification for jobs in less carbon-intensive sectors, to help them with energy transition and energy efficiency (home insulation),
  • Companies: to invest in greener technologies, attract investors.
  • The regions: to support the ecological transition and create jobs in the green economy.

How to achieve carbon neutrality? Fit for 55!

Some of the elements mentioned above are included in the "Fit for 55" climate package unveiled on 14 July 2021, the details of which are and will be discussed for two years. This package of legislation aims to force Member States to reduce their emissions and/or develop GHG capture. It includes 12 measures to move Europe towards climate neutrality by 2050. These include (but are not limited to)

  • Update of the EU ETS regulations:
    - Extension to more sectors,
    - Gradual replacement of free allocation to the most polluting industries by the border carbon adjustment mechanism,
  • Increase carbon sinks: reforestation with the planting of 3 billion trees,
  • Upward revision of the ambition on renewable energy,
  • Tax on paraffin for intra-European flights,
  • End of sales of combustion engine vehicles in 2035,
  • Tax the most carbon-intensive fuels and redirect use to more sustainable fuels, for example in aviation and shipping.

The difficulties of the green pact

The task of achieving a climate-neutral continent by 2050 is colossal, and Europe is a pioneer on the subject, which is very encouraging. Moreover, this Green Deal opens the way for a rise in international standards on environmental issues by encouraging partners to align themselves with European ambitions. It is also an opportunity for Europe to boost its economy and to export an environmentally sustainable model to the world.

While it is very encouraging, implementing such measures in the time available is a major challenge. This is due to the number and diversity of actors involved.

Inequalities in the initial energy mix

Within the EU, the Member States are divided. On the subject of energy transition, the countries are unequal, with Poland, for example, whose energy resources are 70% coal-based, and Germany, where the majority of energy is still of fossil origin. This division is reflected in the negotiation of legislative texts, which are often revised downwards in terms of ambition, and even in the refusal to sign the Green Pact (in the case of Poland).

Socio-economic inequalities: ensuring an "inclusive" transition

From a social point of view too, it will be necessary to ensure that the transition is fair for the most vulnerable households in the face of a possible rise in prices: renovation of buildings, price of food (organic and sustainable), access to energy (heating, mobility)... It is possible to see social movements rising across Europe, such as the yellow waistcoats in France, if households are not properly supported in this ecological transition.

Stormy discussions with lobbies

Finally, in all sectors, the manoeuvring of the lobbies risks lowering the initial targets set by the EU and delaying their implementation. Their main argument being exposure to tough international competition, it will be necessary to hold negotiations to support a pact that is equal to the current environmental challenges.

The dates of the Green Deal

What is happening is historic for the European continent, let's hope that the discussions allow the EU to stay on course for decarbonisation and the preservation of ecosystems! Here is a small timeline to remind you of the key dates in the past and the future.

Resources

1000 billion for the green pact

The European Green Deal Investment Plan and Just Transition Mechanism explained

Farm to Fork strategy

Biodiversity strategy

Energy and Green Deal

Green pact and climate package: the EU aims to be carbon neutral by 2050

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