June 18

Climate policy survives the EU election – for now

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For the past few months, there have been countless media articles breathlessly anticipating a far-right breakthrough in last week’s European parliamentary elections and pondering the demise of Western democracy and global climate policy. Would Europe survive an influx of nationalists or collapse into 27 squabbling nations? Would the EU’s global leadership in climate action be replaced with signs saying “‘Diesel ist super!’”? But while the far right made undeniable gains, especially in France and Germany, the strength of a union built on 27 countries and 450 million people has weathered the storm for now.

In fact, European Commission President Ursula von der Leyen was downright jubilant after the elections, saying that the political centre was “holding” as her European People’s Party (EPP) won 189 of 720 seats to remain the largest party by far. While the liberal (Renew) and socialist (S&D) parties lost seats, the groups together held enough ground to have a workable majority in Parliament. The Greens, who lost 19 seats to return to their pre-2019 size, also look likely to support the conservative EPP, ensuring a comfortable majority.

There were serious concerns heading into the election that the far right would win enough seats to force itself into a ruling coalition and roll back parts of the continent’s Green Deal (a sweeping package to boost renewables, energy efficiency and building renovations; reduce methane emissions; develop a carbon border tax; boost EVs; expand carbon taxes and more), but that bullet has been dodged, and in doing so, von der Leyen has secured her single greatest legacy.

“The election results show that while the far right has gained some ground, they do not have enough seats to form a stable ruling coalition or dismantle the European Green Deal,” says Linda Kalcher, executive director of Strategic Perspectives, a Brussels-based think tank. “Any rollback would be economic insanity as it would create uncertainty for business and investors at times when the U.S. and China are the more appealing destinations for net-zero industries.”

Analysts see two primary concerns about Europe’s climate ambitions in the future: procrastination at the EU level and delay at the national level.

“With increased pressure from the right, the mainstream centre-right European People’s Party might be tempted to push for postponements or watering down some of the most controversial provisions of the Green Deal (such as the 2035 ban on internal combustion engines),” wrote Simone Tagliapietra, a senior fellow at Bruegel, a European think tank that specializes in economics. The other risk is that “Germany, France, Italy and other large countries are expected to do the heavy lifting, but what if their governments do not deliver?”

One national diplomat, who preferred to remain anonymous but was intimately involved in Green Deal negotiations, is optimistic: “As competitiveness and security come into greater focus due to external events, the clearest pathway to achieving these goals is to drive forward with policies that deliver on European renewable and energy-efficiency targets. This is the most cost-effective way to ensure energy security, autonomy, competitiveness and decarbonization.”

During the election campaign, it was clear that climate issues would not be front and centre the way they had been in 2019. “The main priorities [now] will include strengthening industrial competitiveness, enhancing energy security, and addressing the cost-of-living crisis,” Kalcher says. “The new coalition can align on a European industrial strategy that delivers on decarbonization goals, reindustrializing the economy and reducing dependency on fossil fuel imports.”

Essentially, decarbonization efforts are likely to continue, but the motivation will be different – it will be about energy security, protecting jobs and helping industry.

“However, efforts related to biodiversity and nature protection might face more resistance due to the protests by farmers,” Kalcher adds.

Farmer protests have been a regular occurrence in several EU countries over the last year. Irish and Dutch farmers have protested over nitrogen emissions limits, Polish farmers blocked shipments of now tarif-free Ukrainian wheat, French farmers have dumped manure in front of government buildings over low prices and overseas competition, and German farmers protested the end of fuel subsidies. Greece, Portugal and Italy have also seen tractors in their streets.

The first big test for the new Parliament will be the approval of the bloc’s 2040 targets. They are a key complement to the existing legally binding 2030 and 2050 targets. A European Commission report earlier this year recommended a 90% emissions-reduction target compared to 1990 levels, but there has not yet been a formal legislative proposal. That will fall on the incoming Parliament and Commission likely in early 2025.

If conservative parliamentarians do try to weaken the 2040 targets, it could mean that the next few years will be very rocky indeed for European climate action.

Perhaps the biggest surprise of the elections came from France. President Emmanuel Macron called snap legislative elections after his party, Renaissance, was trounced in the European elections. If the far-right National Rally (RN) wins the domestic elections scheduled for June 30 and July 7, it would claim the post of prime minister, while Macron would continue as president until 2027.

Marine Le Pen, who leads the RN in the legislature, threatened to pull France out of the EU Green Deal and to impose a moratorium against wind turbines (on shore and off) and on all solar production. She did promise not to take France out of the Paris Agreement, at least.

Source: Corporateknights.com

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