What should the EU do?

1

Enhance its NDC to be 1.5 degree aligned by COP26:

  • Start an early enhancement process to come back to the table before 2025 (by 2022 or 2023) with a new NDC enhancement that fully aligns with the Paris Agreement objectives, reaching -65% emissions reductions by 2030
  • Offer political support to leading cities committing to -65%.
  • Release a package of laws in 2021 to provide detail on how to reach the current targets, including:
    – A near-total coal phase out by 2030 (to be implemented through the reform Emission Trading Scheme) and gas demand being at least cut in half (compared to the 2019 level) by 2030,
    – Renewable energy to make up to 70-75% of power mix by 2030 and setting adequate targets in the Renewable Energy Directive
    – Annual building renovation increases to 2.5% for all buildings and requires deep renovations with around 80% of energy savings to be set out in the upcoming buildings and energy efficiency law reforms
    – Electric vehicles should be up to 80% of new car sales, with the internal combustion largely phased out by 2035 at the latest as part of the reform on Co2 standards and EU’s mobility strategy
    – A substantial shift to a more circular economy, coupled with stronger focus on recycled materials and sharing the service of products, all reducing material requirements and manufacturing emissions to be set out in the new industrial strategy
    – Reducing agricultural emissions by at least 25% compared to 2015 – to be introduced in an adequate law
  • Step up Green Deal diplomacy to advance conversations with China, India & African Union on NDC increase & climate cooperation
  • Member states to prepare fair contribution to international climate finance ahead of COP26 to comply with the annual USD 100bn commitment to developing countries.
  • EU to stay firm & advance agenda on climate & trade
2

Build a just and resilient recovery plan:

  • Revisit the climate earmarking of funding and increase it to 50%, while including full alignment of the entire funding package with the Paris Objectives
  • Strengthen funding criteria, apply EU taxonomy to qualify what is “green”, and “do no significant harm” principle for entire funding.
  • Commit that recovery support and debt relief will incentivise developing countries to deliver SDGs
  • Significant investments in public transport, green infrastructure, and building renovations to enable the transition. Boost transformational power of urban areas.
  • Exclude fossil subsidies – funding for fossil-fuel intensive sectors should be conditional on clear transition plans to achieve climate goals

What you need to know about the EU ?

  • Commission’s Impact Assessment (Parts 1 & 2) show at least -55% emission cut by 2030 is feasible. Emission reductions in energy sector are the priority (as they account for 75% of EU GHG emissions).
  • A study from June 2020 suggests that achieving this -55% goal would require a near-total phase out of coal by 2030, and a direct move to renewable energy (with 75% RES for electricity production by 2030), without adding new capacity in gas.
  • Renovation rates would need to double or triple to reach between 2.5%-3.4% annually by 2030 compared to 2020.
  • Transport core options include vehicle efficiency, clean fuels, modal shift.
  • European ETS: no floor price yet. Transport, buildings and agriculture not covered by EU ETS (except for intra-European aviation).
Recovery Measurements to Highlight

  • 30% Next Generation EU (EU recovery package) to be earmarked for climate (France 30%, Germany around 33%)
  • Countries seeking money from recovery fund likely to need to show 37%-40% of their resilience & recovery plans earmarked for climate (under discussion)

Recent developments, threats and levers for action

Recent developments

  • Long-term strategy submitted: 2050 climate neutrality target included. EU fair share would require earlier climate neutrality. LTS as a trampoline for future discussions. Increasing number of member states with carbon neutral long-term strategies.
  • Progress on plans for buildings efficiency, offshore wind & first hybrid interconnector indicate EU moving to the “next phase” of deeper decarbonisation. Taking to scale while phasing out incompatible investments, in particular fossil gas, will be key to fast and orderly transition.
  • EU Climate Law & NDC:
  • Enhanced NDC submitted with an “at least -55% emissions reductions” target included.
  •  Regulation pending with concrete sectoral targets to be adopted in 2021.
  • Coal phase-out and sales bans on fossil combustion engine vehicles:
  • Coal phase-out: Poland gradually starting to phase out coal (target of 56% in Power sector by 2030); Spain plans phase-out by 2030.
  • Ban ICE vehicle sales: Slovenia by 2025/2030; Denmark/Netherlands/Ireland/ Sweden by 2030; France/Spain by 2040.
  • Business is getting ahead of the curve: progressive business alliances speak up; CEOs EU wide announced support for -55% NDC; large-scale investments in battery manufacturing and ultrafast EV-charging network; investors, re-insurers, banks re-assessing investments.
  • Green Deal Diplomacy: EU clear signals towards China were followed by ambitious Chinese pledge for climate neutrality by 2060, demonstrating EU diplomatic potential. But consistent & cooperative Green Deal diplomacy must be articulated to catalyse global support for transition.
  • Dynamic around European Green Deal: New industry strategy coming in 2021.
  • Recovery: Parliament wants 40% of recovery funding in every national plan to be spent on climate and none of the investments to do significant harm to the environment (they should exclude funding fossil gas). To avoid greenwashing, the rules on sustainable investments (“green taxonomy”) should apply to decide what can be counted to the 40% climate spending. A third of recovery funds will be raised through green bonds, but there are attempts to water down the green ambition of EU financial tools meant to deliver a green recovery.

Strengths

  • Successful implementation of current NDC; LTS submitted
  • Impact Assessment of EC pushing for -55% by 2030; EP for 60%
  • Positive dynamic for climate protection among population ongoing, climate topic of top interest

Opportunities

  • Current German EU Council Presidency positive for dynamic (e.g. Climate Law); Portugal and then Slovenia in 2021.
  • Green Deal Diplomacy
  • EU position as largest single market and one of largest economy = lever for aligning trade with climate and biodiversity objectives
  • Next Generation EU – use green taxonomy to assess what count as climate spending.
  • Momentum in Dec. 2020 with Paris 5 year anniversary.

Weaknesses

  • Eurosceptic populist trends: Visegrad Axe “V4” (especially Poland & Hungary)
  • EU Next Generation is a silver bullet
  • Institutional challenges: Brexit, Conference “Future of EU”

Threats

  • Corona virus-induced economic downturn
  • Brexit implications
  • US elections with Trump II scenario
  • Gas lobby

About Climate Diplomacy Snapshots

The data is clear. Accelerated and enhanced action is needed now to build resilience and avoid the worst impacts of climate change. As they seek to address the ongoing health, economic and social impacts of COVID-19, governments should seize opportunities to invest in a recovery that will build social, economic and climate resilience on the long-term.The Climate Diplomacy Snapshots aim to provide the climate community with a clear overview of what each country should do, on climate and recovery, to pursue these joint objectives and keep the global average temperature increase to 1.5°C. Each has been prepared with the help of national experts, and will be regularly updated. The snapshots aim to support climate advocacy in the lead up to COP26.

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