EU stays the course with EU 2040 target amendment
We Mean Business Coalition
The European Commission has taken an important step to keep leading on tackling climate change. The proposed Climate Law amendment, with its headline EU 2040 target of a 90% reduction in emissions, is an impressive line in the sand in the context of geopolitical and trade headwinds. It should be praised as good news and will continue to bring more prosperity to Europeans, while also leading the way for other countries, especially emerging economies, to follow.
We were pleased to see the EU pushing for this robust and achievable reduction goal, stepping up and staying the course towards its net-zero ambitions in the face of US retraction.
Nobody would have thought 90% technically or politically achievable just a few years ago. But that fact that it now is, is down to the actions of thousands of companies to drive the clean energy transition to date. The target provides clarity and much need predictability to businesses on the trajectory of EU policy, as it gives an inevitable direction of travel that will be challenging but make companies more competitive. Going forward it is important that the Commission continues to directly link the Clean Industrial Deal to the 2040 target as a key policy delivery mechanism.
Given diversity of European countries and industries, some amount of flexibility will be important and is recognised in the proposal. The challenge now is to make sure that the use of flexibilities, including international carbon credits, is designed in a way that continues to drive urgent investments and improvements in European competitiveness on the road towards net-zero, still delivering the structural emissions reductions at home. At the same time, the use of high-quality international credits after 2036 can help provide a much needed source of finance to developing countries given that development aid budgets are more stretched than ever.
We will work continue to work with our partners and companies to support the 2040 target proposal through the political discussions with the EU Member States and European Parliament. We support coherence between the 2040 climate target and the 2035 NDC and their swift adoption. This coherence entails that the 90% target should serve as a basis to inform a 2035 NDC of at least 72.5%.