EU climate change plan is in conflict due to rising emissions costs

Brussels’ historic attempt to combat climate change has faced opposition from European Union governments on the grounds that its plan would hit their families with higher energy costs.

EU lawmakers told the Financial Times that the European Commission tried Extend carbon pricing to the most polluting sectors of the economy Cars, buildings, etc. are in danger because member states object that this will force their poorest people to pay.

Frans Timmermans, executive vice president of the committee responsible for green transactions, said that these measures need to be taken to “price carbon and price decarbonization.”

“Our current tools are not doing enough. If we don’t deal with the climate crisis, we will fight for water and food,” he said.

Brussels proposed on Wednesday 13 legislative measures It aims to help reduce average greenhouse gas emissions by 55% by 2030 and achieve net zero emissions by 2050 compared to 1990 levels.

The core of this strategy is to expand the EU’s carbon pricing mechanism, the emissions trading system, in which companies must pay pollution costs.

Governments in some of the largest states have lined up to question the advantages of expanding the system to cover road transport and building heating emissions, believing that this will have a “regressive” effect on residents who cannot easily afford more environmentally friendly alternatives.

Since its creation in 2005, the quota system has been limited to large power generation companies and polluting industries that purchase quotas to pay for emissions.

In the past month, EU carbon prices have been hovering at around 55 Euros per ton, more than twice the pre-pandemic level, as traders bet that if the EU is to meet its emissions targets, it will need to tighten its carbon allowances.

But diplomats told the Financial Times that France, Spain, Italy, Hungary, Latvia, Ireland and Bulgaria all expressed concerns about the impact of the plan on citizens at the meeting of EU ambassadors on Wednesday.

Before proposing the plan, Ursula von der Leyen, the chairman of the committee, had at least seven of her 26 committee members opposed. The reform requires the support of a qualified majority EU government and the European Parliament to take effect.

A senior EU diplomat said that although the ETS expansion plan coexists with a 72 billion euro fund designed to help alleviate energy poverty, it may be abandoned.

The plan promises to start tortuous negotiations in the next few months and is expected to last until 2023. Controversial policies include a ban on the sale of new diesel and gasoline vehicles from 2035, a kerosene tax on aviation, and a border tax on carbon-based imports.

The so-called social climate fund has also encountered resistance from “thrifty” northern countries such as the Netherlands, which oppose greater redistribution of funds within the EU. The diplomat said: “If the fund is cancelled, the logic behind the new ETS will disappear.”

Officials said that the opposition forces the committee to postpone plans on how to use the funds generated by the carbon market and border taxes to repay EU debts that were scheduled to be implemented next week.

Germany and Denmark are among the countries that support the expansion of ETS, and Brussels expressed the need to accelerate the decarbonization of transportation and buildings that have steadily increased carbon emissions over the past 20 years. Since the beginning of this year, Germany has been experimenting with a national carbon market for cars and buildings.

Dan Jorgensen, Danish Climate Minister, stated that ETS has proven successful in reducing industrial emissions and should be expanded. He told the British “Financial Times”: “We know there are pitfalls and we need to be careful so that the system does not trigger emissions reductions and not the other way around.”

Pascal Canfin, a member of the French European Parliament and head of the Parliament’s Environmental Committee, said that this measure may hinder citizens’ perception of the message behind Europe’s promotion of climate change. “I support the package, but in [the ETS] The narrative has become a new tax. what a pity. “

As Paris will assume the rotating presidency of the European Union next year, which coincides with the presidential election, France will play a central role in leading the negotiations on the lucrative green package.

Emmanuel Macron’s government, which supports the EU’s climate goals, warned against exposing consumers to rising energy prices triggered by rising energy prices. Yellow vest Protest against the government.

Canfen said that the conduct of the election will mean that the chairman of the French parliament “cannot give the green light to a measure that seriously violates what we want to see.”

When talking about heating and other issues, a French official said, “People have no choice – they can’t replace the boiler overnight. What seems really important to us is because of their experience. Yellow vest, There is a way to help people get through the change. “

Additional reports by Sam Fleming in Brussels and Victor Mallet in Paris

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