European Parliament on Thursday, 13 November adopted its position on the Commission’s proposal for an amendment to the EU Climate Law setting a binding 2040 EU climate target of reducing greenhouse gas emissions by 90 per cent compared to 1990 levels. The proposal includes the use of carbon credits up to five percentage points and postponement of ETS2 to 2028.
The position adopted by the Parliament is rather similar to that of the EU Council, which was approved by member states’ environment ministers last week. As a result, the subsequent negotiations in the so-called trilogue are expected to be rather fast.
More flexibility for member states
The majority of MEPs agreed with the Commission’s proposal to introduce new flexibilities in how the 2040 climate target can be met. That includes so-called carbon credits from partner countries. Starting in 2036, up to five percentage points of net emissions reductions could come from these credits. Originally, Commission had proposed a cap of up to three percentage points. Carbon credits can be earned through, for example, forest planting, rainforest protection, or investment in renewable energy sources outside the EU.
MEPs also want the possibility for domestic permanent carbon removals to be used to compensate for hard-to-abate emissions in the EU emissions trading systems (ETS). They also supported enhanced flexibility within and across sectors and instruments to achieve targets that are as cost effective as possible.
Parliament also supports a proposal by member states to postpone the introduction of the ETS2 system by one year from 2027 to 2028. ETS2 covers CO2 emissions from fuel combustion in buildings and road transport.
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Assessment every second year
Parliament wants the Commission to assess progress towards intermediate targets (including the 2040 one) every second year. The assessment should take into account the most recent scientific data, technological developments, and the EU’s international competitiveness.
Such reviews will assess the status of net removals at the EU level compared with what is necessary to meet the 2040 goal, as well as emerging difficulties and the potential for enhancing EU industrial competitiveness. The review will also take into account trends in energy prices and their repercussions for both businesses and households.
Following the conclusions of the review, the Commission may propose an amendment to the EU climate law if appropriate.
Patriots, ECR voted against
The text was adopted by 379 votes to 248, with 10 abstentions. MEPs from the factions of Socialists & Democrats, Renew Europe, Greens. and also part of European People’s Party supported the adoption of the 2040 climate target. On the contrary, European Conservatives and Reformists, Patriots of Europe, and Europe of Sovereign Nations groups were against.
MEPs also approved amendments stipulating that any carbon credits used to help meet the target must be properly regulated and deliver real emissions cuts. Carbon credits must not contribute to damaging the environment in the respective countries.
Parliament is now ready to start negotiations with member states on the final shape of the law.
