Imagine walking through a city where every building is a testament to sustainability, resilience and innovation. A city built by – and now serving – a prosperous, diverse and cohesive society.   

This vision of Europe is not a distant dream.   

It’s an achievable reality if the European Commission delivers on advancing its sustainable building policy – plans for which should be firmly at the top of President Ursula von der Leyen’s inbox when she returns from summer recess later this month.  

In just a few short weeks, her second term will begin in earnest, as will her second push at keeping Europe’s green transition alive – a five-year marathon to cement both her and the bloc’s environmental legacy. 

The Commission’s activity to date has been commendable. The revision of the Energy Efficiency Directive (EED) and the Energy Performance of Buildings Directive (EPBD) were key steps towards accelerating climate action in the sector and driving plans under the Renovation Wave to boost energy efficiency in both public and private buildings.   

Renewable-energy carbon credits rejected by high-integrity scheme

In the “Political Guidelines released shortly after her re-election, von der Leyen has shown promising signs of continuing to champion sustainable buildings as a climate solution. There is a pledge to create the first EU commissioner with direct responsibility for housing, while our sector awaits with interest the new “Circular Economy Act”, designed to create market demand for reused and recycled materials. 

This is promising – but von der Leyen must go further both in implementing existing policies and in developing new ones to maximise the holistic benefits of sustainable buildings for everyone. 

We know already that sustainable buildings have huge greenhouse gas reduction potential. Buildings are responsible for about 40% of total energy consumption in the EU and 36% of greenhouse gas emissions from energy, so they can help improve energy security, reducing the bloc’s exposure to geopolitical shocks and reliance on fossil fuels.     

Creating jobs, lowering energy costs 

What isn’t spoken about enough is that they have the potential to address other issues facing Europe today: the cost of living and the unemployment crises.   

For me, these less-discussed issues in the context of buildings are just as, if not more, important due to their co-benefits for people and society.    

Take the energy efficient renovation of buildings, for example. The widespread availability of well-insulated buildings that keep out the heat during summer but retain the warmth during winter will significantly cut energy costs across the continent.   

The benefits of this will be far-reaching, but particularly for vulnerable or low-income households. Given soaring energy bills, improving energy efficiency across buildings would not only reduce associated costs, but also enhance living conditions.   

The benefits of renovating buildings do not stop here.   

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This task alone could create millions of employment opportunities across Europe: 18 jobs are created for every €1 million invested in this type of renovation.   

Bearing in mind figures from the European Commission, which calculated that €275 billion will be needed annually to bridge the building renovation gap in the EU, this level of investment could lead to nearly 5 million extra jobs across the bloc.   

Not only that, there is a real financial incentive for national governments to look towards investing in the building sector to save in the long run. Data from the Spanish government showed that while supporting one person through unemployment cost €20,000, funding a new construction role amounted to €14,000, a significant decrease. These statistics show a real-world example of how buildings can both address governmental issues and create better prospects for individuals.   

Blueprint ready to go 

Europe is at a significant moment in its history.   

We are only five years away from 2030, a deadline by which Europe committed to slash half its emissions, determining whether it will be on track to become the first climate-neutral continent. Yet the recent parliamentary elections showed a record number of seats from parties that could make the path to net zero more challenging. 

Von der Leyen has a real chance to confirm her legacy of green policies by driving an energy-efficient, regenerative and just transition in the built environment. World Green Building Council’s Europe Regional Network stands ready to continue to build momentum with the Commission over the next five years and create tangible benefits at the individual, societal and national levels.   

Let’s create a brighter, equitable and more sustainable future for all of Europe. The blueprint is ready; we just need to turn it into reality.   

The World Green Building Council leads BuildingLife, a project that drives the Commission’s EU Green Deal across the bloc by working to eliminate the whole-life carbon impact of buildings. 

The post How better buildings can help von der Leyen maintain her green legacy    appeared first on Climate Home News.

Europe’s first comprehensive climate risk assessment, published in May, sent a clear and unequivocal message: climate risks facing Europe have reached a critical level and urgently require decisive actions from European policymakers.  

Yet the recent EU parliamentary elections – which delivered significant gains for Europe’s far-right and dealt a blow to its green parties – alongside a recently leaked list of EU Council priorities for the next five years, indicate a marked U-turn in the EU’s commitment to climate action.  

The EU has faced a dramatically changed geopolitical situation over the past few years, marked by the upsurge of far-right political forces in several member states, growing trade-tensions with China, and a humanitarian disaster and heightened energy security risk caused by Russia’s war in Ukraine.  

Against this backdrop, EU policymakers have had to make tough decisions on strengthening security in Europe, diverting their attention to defense, security and migration issues, although this has come at the expense of the EU’s much flagged international climate leadership and green agenda.  

IEA calls for next national climate plans to target coal phase-down

We argue that the EU should stay the course on climate action. Despite geopolitical turns and a backlash from some industries over legislation brought on by the Green Deal, European policymakers have a responsibility to follow through on climate commitments – and thereby avoid the tremendous risks that face us if they do not. 

Exacerbating geopolitical risks 

Protests have included those by European farmers against sustainability provisions in the EU’s Common Agricultural Policy. Recently, the EU Council only just managed to approve the highly anticipated, but embattled Nature Restoration Law, thanks to a rare display of political defiance by the Austrian environment minister.  

The law provides critical policy levers for improving Europe’s much degraded ecosystems, strengthening their resilience towards climate change. Hence this vote was critical, although it may still face a legal challenge.  

Despite dilution, officials say new nature law can restore EU carbon sinks

There is ample irony in the notion that political efforts and financial resources should be diverted to enhance Europe’s defence and security capabilities and strengthen the EU’s external borders from human migration. Climate change is certain to exacerbate the impacts and risks from geopolitical conflicts and wars and will be the mega-driver of migration over the coming years. 

And while legislation that requires businesses to take action on climate change and biodiversity loss is certainly going to be burdensome for some, these costs pale in comparison with the effects that climate change will have on the European economy.  

Corporate credit rating downgrades due to companies’ exposure to climate risks have already accelerated, according to S&P Global. And climate-induced disruptions of supply chains are likely to cost the global economy up to $25 trillion over the next 35 years under the current trajectory. Much of this cost will be borne by businesses. 

Ways to protect Europe 

EU-level policies are currently dangerously inadequate to safeguard European lives and livelihoods from the majority of the potentially catastrophic threats that will loom over Europe in the coming years and decades.  

But there are solutions, if bold action is taken in the following areas: 

• Protect and restore marine and coastal ecosystems by minimising pressures from overfishing, agricultural runoff and other industrial activities to avoid disastrous degradation of marine ecosystems. 
• Conserve and restore Europe’s forests through the recently passed Nature Restoration Law to safeguard Europe’s ecosystems and their many services on which the European economy and wider society heavily depend. 
• Leverage the Common Agricultural Policy to strengthen incentives and policy certainty for transforming and adapting Europe’s agricultural sector to extreme heat and drought. 
• Shore up the preparedness of healthcare systems and resources against the impacts of heat waves on vulnerable populations and outdoor workers, especially in southern Europe.  

• Bolster investments in climate adaptation abroad. This support will also be critical to reduce cascading climate risks that originate beyond Europe’s outer borders.   

With this comprehensive body of scientific evidence and advice at hand, European policymakers must resist the urge to adopt a tunnel-vision approach and focus solely on near-term risks, but rather approach climate change as a systemic threat to European’s economy, society and natural capital.  

The scientific community already has called on policymakers to reverse the current course of retreat from the EU environmental agenda, in an open letter to the EU’s legislative bodies.  

EU warns “delaying tactics” have made plastic treaty deal “very difficult”

The actions taken by the incoming group of elected lawmakers and appointed officials will determine the level of harm and damage European citizens will have to endure over the coming decades. It is critical that European policymakers take the long view.  

The decisions and actions they take today will lock our children’s future onto a path. Only today’s policymakers can make sure that path takes us towards a world that can sustain a functioning social order and human life.  

The post New European Parliament must act on climate change as a systemic threat   appeared first on Climate Home News.

As this European Parliament term began, Fridays for Future school strikes, inspired by Greta Thunberg, were sweeping Europe, with young people demanding that political leaders act decisively against climate change’s mortal threat. 

Five years on, as the parliament entered its final chapter, very different protests erupted in Brussels and across Europe – this time led by farmers, who clashed with police and brought the city to gridlock. The farmers’ grievances were many, from rising energy and fertiliser costs, to cheap imports and environmental rules.  

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Just as Fridays for Future signified growing pressure on politicians to tackle the climate and biodiversity crises, the farmers’ protests have been seen as a stark warning of the rural backlash against doing so. 

In reality, the reasons for the farmers’ anger are more diffuse.     

Climate and forests centre-stage 

In the early days of the current parliament, the school strikers’ message appeared to be getting through. Tackling climate change was  “this generation’s defining task”, the European Commission declared. Within 100 days of taking office, the new Commission President Ursula von der Leyen met her manifesto promise of launching the European Green Deal. 

The following few years saw climate and forests take centre-stage in EU policymaking to an unprecedented degree: from the Climate Law, which wrote into the statutes the EU’s goal to be climate neutral by 2050, to the Nature Restoration Law (NRL), setting binding targets to bring back nature across Europe, and the EU Regulation on deforestation-free products (EUDR), the first legislation of its kind in the world, which aims to stop EU consumption from devastating forests around the world. 

Then came the backlash. 

Despite exit, EU seeks to save green reforms to energy investment treaty

Over the past year, vested industry interests and EU member states have tried to sabotage key pieces of the European Green Deal, including the NRL and the EUDR. 

This pushback against laws to protect the natural world is now a battleground in EU parliamentary elections, with populist, far-right and centre-right parties seeing it as fertile vote-winning territory. 

The centre-right European People’s Party, the largest group in the European Parliament, has been campaigning against key planks of the Green Deal, including the NRL, while promoting itself as the defender of rural interests. 

But the views of the rural constituencies whose votes they covet are not as simplistic or polarised as widely depicted. 

Deep listening 

At Fern, we’ve increasingly worked with people who share the same forest policy goals but are bitterly opposed to one another.

This is why we commissioned the insight firm GlobeScan to run focus groups among rural communities in four highly forested countries: Czechia, France, Germany and Poland. We wanted to find out what those whose concerns have been used to justify the backlash against green laws really think. The results contradict the prevailing narrative. 

All participants – selected with a balance of genders, occupations, political views and socio-economic statuses – felt that forests should be protected by law, and unanimously rejected the idea that such protection measures are a threat to rural economic development or an assault on property rights.

They felt deeply attached to their forests, saw them as public goods, were concerned about the state of them, and had a strong sense of responsibility and ownership towards them. They also wanted to see action to improve industrial forest management practices and mitigate climate change. 

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While there was some sympathy for concerns around too much bureaucracy, even those who expressed this view felt forests should be protected by laws. Moreover, they saw the EU as having a primary role in providing support and incentives, and developing initiatives to fight the climate and biodiversity crises.  

Given how much EU politicians have put rural concerns at the heart of their arguments for rolling back the Green Deal – and are now using them in their election campaigns – it’s telling that their narratives on this do not resonate widely. Even foresters with right-leaning political views saw most of them as extreme and oversimplified. 

The lesson here is that the simplistic, divisive arguments that dominate the public debate over rural people and laws to protect nature do not reflect the complex reality of peoples’ lives or their attitudes. Where a divide exists between those pushing for strong laws to protect nature and the rural communities supposedly resisting them, it’s far from irreconcilable. 

Bridging any such gaps by listening and understanding each other’s perspectives is vital for all our futures. Those elected to the next EU Parliament would be wise to heed this. 

For further information, see: Rural Perspectives on Forest Protection 

The post Right-wing pushback on EU’s green laws misjudges rural views  appeared first on Climate Home News.

The head of the EU’s executive branch Ursula Von Der Leyen announced yesterday that she was nominating Hoekstra to lead the EU’s climate finance work and climate diplomacy in the run-up to Cop28.

But while he has the approval of Von Der Leyen’s European Commission, Hoekstra still has to win over the European Parliament’s environment committee.

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That will be difficult as left-wing members argue that the centre-right Dutchman does not have a good enough climate record.

Analysts and campaigners have expressed similar concerns, arguing that Hoekstra has not expressed interest in climate change and that his hardline fiscal conservatism is likely to obstruct climate finance to the developing world.

Fiscal hawk

In Europe, Hoekstra is best known for opposing wealthier north European nations like the Netherlands lending money to poorer southern European countries.

In March 2020, Portugese prime minister António Costa branded Hoekstra “repugnant” and “senseless” after he called for the EU to investigate why some countries did not have enough savings to deal with the economic impact of the Covid-19 pandemic.

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If he is confirmed, Hoekstra will lead the EU’s negotiations at Cop28 on the new fund for the loss and damage caused by climate change and on other climate finance issues.

“I think the parallel between intra-EU solidarity and international solidarity is an obvious one,” said Dutch E3G analyst Pieter De Pous,”I’m sure he’s going to get a lot of questions on that.”

Domestic disinterest

Hoekstra’s domestic climate record has also been criticised, with Greenpeace EU campaigner Silvia Pastorelli saying it “doesn’t inspire much confidence”.

After leaving university, Hoekstra spent three years working for the Anglo-Dutch oil company Shell in various junior positions.

Much later, as finance minister, he bailed out the airline KLM without putting substantial green conditions on the money.

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Pastorelli accused him of having “led the attack in government against rules to cut nitrogen pollution”.

These rules provoked fierce protests from farmers, who De Pous said are the traditional voters of Hoekstra’s centre-right party.

Partly as a result of this pushback, Hoekstra’s party has sunk in the polls and so, with elections scheduled for November, his domestic political prospects have sunk.

Dutch election

Since 2019, the EU’s climate work has been led by Dutch politician Frans Timmermans.

Last month, he announced he was stepping down from that role to campaign to be prime minister in the Netherlands’ November elections.

The Dutch government chose Hoekstra to replace him and, after an interview, Von Der Leyen accepted their choice.

If approved, Hoekstra will lead on climate action “under the guidance” of Slovakian commissioner Maroš Šefčovič.

Parliament hearing key

Hoekstra will soon have a hearing with the European parliament’s environment committee where he will be grilled on his record and suitability for the job.

To get approval, Hoekstra needs a two-thirds majority of the committee’s 87 members.

But his and Von Der Leyen’s centre-right European Peoples Party group only has a quarter of these members.

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Members from other groups have already expressed scepticism. Centrist French member Pascal Canfin said that his confirmation was “not a done deal” and “he will have to prove that he is the right man”.

Left-wing Dutch member Mohammed Chamim told Euractiv: “I was not very enthusiastic upon hearing about Hoekstra’s nomination. He has never shown any interest or ambition regarding climate policy before.”

The date of the hearing has not yet been set. If rejected by the European parliament, the Dutch government will have to nominate another candidate.

Dutch media has suggested that Centrist Sigrid Kaag may be chosen. De Pous said the former profesional diplomat be “more qualified” because of her international experience.

The post EU nominates Wopke Hoekstra as top climate diplomat appeared first on Climate Home News.

Europe’s economic relations with Argentina are strong. Despite the geographical distance, EU investment in the country accounts for half of foreign investment. Similarly, the bloc is Argentina’s third-largest trading partner, behind Brazil and China.

While the more comprehensive trade agreement between the EU and its Latin American counterpart, Mercosur, flounders, von der Leyen agreed on a bilateral agreement with Buenos Aires on Monday (17 July). It follows a similar agreement on materials agreed in June.

“Europe and Argentina are partnering for a more secure, sustainable and prosperous world,” she said.

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The non-binding agreement hinges on four key aspects: hydrogen and its derivatives, renewables, energy efficiency, and liquefied natural gas (LNG).

With Russian gas flows into Europe at an all-time low, the two partners committed to “enabling a stable delivery of liquefied natural gas (LNG) from the Argentine Republic to the European Union.”

Argentina’s export dreams

The 45 million-strong country, which heavily relies on natural gas for its own energy consumption, is a serious player in the gas industry – bolstered by the rich shale gas stemming from Vaca Muerta in the South-West.

To export its fracked riches, Buenos Aires is working on a law to boost its LNG industry – with an eye to begin exporting at scale as early as 2027.

The agreement insists that supplying LNG will be  “consistent with [the EU’s and Argentina’s]  respective long-term decarbonisation objectives and consistent with the goals of the Paris Agreement.”

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Likely as a concession to Brussels, the agreement also insists that Argentina tackles its leaky gas wells. In 2022, at least one new gas well was drilled in Vaca Muerta per month.

Meanwhile, the formerly Argentina-based NGO Center for Human Rights and Environment warned in 2018 that at least 5% of produced gas was entering the atmosphere, often due to operators venting surpluses to maintain operational security.

“The Participants endeavour to reduce methane leakages in the fossil gas supply chain to the maximum technically feasible level,” the EU-Argentina agreement stresses, adding that new technologies should help tackle “venting and flaring.”

Both venting and flaring are commonplace methods of ensuring production equipment does not get damaged by too much fossil gas. Given methane’s extreme climate impact, it is 28 times worse than CO2 on a 100-year basis, uncontrolled venting is among the most climate-damaging by-products of producing fossil gas.

The agreement also points to integrating “recovered methane into the supply chain.” Methane that would otherwise leak into the atmosphere can be captured and used regularly. One key source may be landfills, like Norte III in Buenos Aires, which account for about half of the city’s methane emissions.

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Renewable potential

“In large parts of your beautiful country, in the large plateau of the South, you can only hear one sound: this is the sound of the wind, running undisturbed,” explained von der Leyen in June when speaking to business executives.

Argentina has all it takes to become a “renewable energy powerhouse,” she said, adding that “the extraordinary Patagonian winds are a blessing of nature.”

In practice, the EU-Argentina agreement is sparse on the details – aside from a commitment to “facilitate investments necessary to increase energy trade between the Participants.”

European investments are largely expected to come through the European Gateway Initiative, which has a “Team Europe” approach, meaning that EU countries invest under the banner of the bloc.

For example, France and the EU have supported upgrading and bringing the country’s electricity grid up to speed. Other projects include waste and water management support and aid in exploiting the country’s rich mineral resources.

Whether similar initiatives will help fund the country’s nascent LNG infrastructure is unclear.

The post EU and Argentina strike gas, hydrogen & renewables deal appeared first on Climate Home News.

A global renewables target has been positioned as a centerpiece of the climate talks. The EU was among the first to get behind it in principle and will discuss at their Council meeting.

But there is an unexpected twist. The EU’s executive arm, the European Commission, has asked the EU’s council, which represents member states, to officially approve a negotiation mandate for a global renewables target.

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But their ambition falls short. Globally, we need to reach a yearly installment of, on average, at least 1.5 Terawatt (TW) renewable energy from 2030 onwards to be in line with the Paris Agreement. That’s clear from our own analysis and that of Climate Analytics.

 However, the EUs internal documents only suggest yearly deployment rates which lands at below 1 TW. Even the UAE Cop28 President Sultan Al Jaber has put forward more ambitious proposals.

Why is the EUs global renewable ambition even lower than what a petro state has put forward?  If the EU wants to be a renewable energy champion it needs to significantly up their game.

Why a target is crucial

Cop28 represents a pivotal moment in stopping the world warming by more than 1.5 degrees celsius through the Global Stocktake, a unique mechanism under the Paris Agreement to assess progress and to correct course.

If we are honest, we already know we are not doing enough. What matters is what comes next: Fossil fuels cause three-quarters of global greenhouse gas emissions.

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If this is the Cop to “course correct”, no outcome will be credible without a centerpiece decision to phase out all fossil fuels –  coal, oil, and gas  – while simultaneously powering up renewables.

A global renewable target is indispensable for guiding the entire energy transition. It provides governments with a benchmark for renewable deployment, informing decisions regarding planning permission, land use, grid connections, and auctions.

Additionally, the target guides governments on how to integrate renewable power effectively, considering factors like grid investments, flexibility, storage requirements, and market design changes.

In the coming decade, much of the newly added renewable electricity capacity will meet the growing electricity demand rather than replacing coal and gas generation.

What a target must entail

Science provides a clear framework for action. By 2050, we must completely eliminate fossil fuels to stay within the 1.5-degree carbon budget. This necessitates a rapid phase-out this decade, resulting in a 43% reduction in emissions by 2030 compared to 2019 levels.

Formulating a renewable energy target might be more complex. But its crucial and we must get it right.

The International Energy Association’s (IEA) scenarios provide a useful starting point. For achieving a 1.5C-aligned renewable energy deployment, the IEA predicts a peak installation of 1.2TW per year in the 2030s.

UAE’s al Jaber says Cop28 will fast-track phase down of fossil fuels

But this scenario has two significant flaws. First, the 1.2TW scenario assumes unrealistic utilisation of Carbon Capture and Storage (CCS) in the energy sector.

CCS has long been a deceptive tool of the fossil fuel industry, with limited emissions-cutting potential and exorbitant costs.

A recent Climate Analytics study estimates the emission-cutting contribution of CCS to be 0.1% by 2030. It is only viable in hard-to-abate sectors such as steel production, not energy.

Secondly, the IEA scenario envisions an unsustainable and unattainable growth of biomass. By excluding unrealistic amounts of biomass and CCS, a more realistic estimate for renewable deployment in the 2030s is 1.5 Terawatt.

In fact, the above highlighted Climate Analytics analysis also lands at this number. So there is a real question why the EU is locking itself into a low ambition Renewable Energy goal.

The target’s politics

Those who disguise cynicism for realpolitiks may  say 1.5TW is aiming too high and a global fossil fuel phase out is politically not possible. But both are not only necessary, they are feasible.

This year, the world will add a record 0.44TW of new renewable capacity –  double what the IEA expected for 2020. This represents a jump in renewable installment of about a third compared to last year.

Taking 0.440TW as the 2023 base, we don’t even need yearly growth of a third – a quarter is enough to exceed the 1.6 TW by 2029.

The UK’s retreat from climate leadership is not in its national interest

The EU falls short of what is needed and what we can achieve – but how does it to compare to the position of the UAE?

Al Jaber said: “We must triple renewable energy capacity over the next seven years”. That carries multiple interpretations.

But the most straightforward is this: Global renewable electricity capacity needs to triple from the end of 2023 to 12.2 TW by 2030.

This entails adding an average of 1.2 TW of renewable capacity each year from 2024 to 2030.

Not a linear trajectory

But the growth of renewable energy capacity will not follow a linear trajectory.

Instead, we anticipate accelerating installation rates that would likely propel us well beyond the 1.5TW mark by 2030.

The crucial aspect of Al Jabers statement lies in the phrase “next seven years,”. At the same time, the oil CEO and Cop28 president Al Jaber might cynically push ambition on renewables to not have to reach a decision to phase out fossil fuels.

Identifying loss and damage is tough – we need a pragmatic but science-based approach

At Cop27, a handful of countries  – Iran, Saudi Arabia and Russia –  opposed language to phase out all fossil fuels, and so far Al Jaber is positioned to hide behind the same few blockers with vested interests.

At the climate talks in Bonn he infamously stated the phase down of fossil fuels is “inevitable”. The next few weeks will test if the UAE is actually serious about phasing out fossil fuels and powering up renewables.

If the UAE is serious about the energy transition, they will announce a ministerial pair on energy transition as usual for sticky issues in the COP process – to elevate discussions on fossil fuels and renewable energy and unlock progress.

If we win this crucial battle at Cop28, it will not be thanks to a low ambition-EU and the fossil-UAE, but thanks to renewable champions in the Global South like Kenya, Colombia, the Climate Vulnerable Forum and the Pacific islands.

Andreas Sieber is the Associate Director of Policy at 350.org and Nicolo Wojewoda is the Director of 350.org Europe.

The post The EU lacks ambition on Cop28 renewable targets appeared first on Climate Home News.

But researchers doubt how green Mozambique’s aluminium really is and whether it will be able to stay green. If it can’t, analysts told Climate Home, the EU’s carbon border tax could have catastrophic ripple effects through one of the world’s poorest economies.

For years, policymakers in the European Union have worried that their heavy industries would flee abroad to escape taxes on carbon.

To try and avoid this, in 2021, the EU approved a tax on the carbon emissions that come from imports — called a carbon border adjustment mechanism.

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Although emerging economies like China shared “grave concern” about “trade barriers”, the EU claimed it was just a way of ensuring that the carbon emissions of products that end up in the EU are taxed the same whether they’re made in the EU or not.

The tax will come into force in 2026 and apply to particularly polluting products like electricity, fertilisers, cement, iron, steel and aluminium.

Green aluminium?

The aluminium sector is Mozambique’s biggest industry and the its largest industrial employer, a source of income to nearly 3,000 people and an indirect boost to many more. But as EU rules approach the sector, some companies have rushed to green claims.

One strategic asset is a large smelting facility on the outskirts of the country’s capital Maputo, where the aluminium is processed. The smelter is owned by a company called Mozal, which is now owned by Australia’s South32, a company that spun out of BHP Biliton in 2015.

South32’s CEO Graham Kerr told the Melbourne Mining Club recently that European carmakers are choosing to pay more for Mozal’s aluminium because it is produced with hydropower electricity not the fossil fuels of some of its rivals. 

A view of Cahora Bassa dam in 2010 (Reuters/Goran Tomasevic)

Nearly two-thirds of the emissions of the product’s emissions are from the smelting, where alumiumium is extracted from alumina at a very high heat. Producing that heat requires a lot of electricity.

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According to a 2022 Mozal report, “electricity supplied to Mozal Aluminium is generated by Hidroelectrica de Cahora Bassa (HCB), a hydro-electric power generator situated on the Zambezi River”.

But, it adds, “the electricity is supplied via Eskom’s South African grid” through the cables of Motraco, a joint venture between the utilities of South Africa, Mozambique And Eswatini.

HCB is in the north-west of Mozambique while Mozal’s smelter is in the far south, near the South African border.

About 90% of South Africa’s electricity is produced using coal and transmission lines like those providing electricity to Mozal’s aluminium smelter don’t distinguish between electrons produced by water and those produced by coal.

South32 adds in its sustainability report that Eskom provides “back-up energy” to Mozal, to make up for periods when HCB is not sending as much electricity. 

A South32 spokesperson said the smelter was “largely powered by hydropower”.

Concern for poorer countries

Although poverty campaigners like Oxfam called for the world’s poorest countries to be exempt from the tax, the EU made no allowances for Least Developed Countries (LDCs).

Of these countries, economic modelling from the African Climate Foundation and London School of Economics suggests that the south-east African nation of Mozambique is likely to be one of the worst hit.

They predict Mozambique’s wages will fall 0.12% as a result of the tax. That would be a small fall but one that workers in the world’s sixth poorest country can ill afford.

Dimas Sinoia, researcher at Mozambican think Centre for Development and Democracy (CDD) told Climate Home that CDD tried unsuccessfully to interview workers at Mozal about the measure. “Until the start of the year, it seems that Mozal employees had no knowledge of [the tax],” he said. 

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Mozambique produces 570,000 tonnes of aluminium a year. Over 90% of this is exported, much of it to Europe. From 2026, the carbon emissions from making this aluminium will be taxed at the European Union’s border. 

Sinoia worries that a reduction in exports will hurt job prospects for Mozambicans along the industry chain and that the cash-strapped and indebted Mozambican state will get less revenue through industrial taxes.

Sinoia said the tax is “an inequitable measure as it does not consider the adaptive capacity of the affected countries” and, while it will cut emissions, it “will have a high cost in reducing social well-being and poverty”.

Future uncertain

Not only are the green credentials of Mozal’s current supply questionable, but its future power arrangements remain uncertain. Its contract with Eskom is set to expire in 2026.

According to its spokesperson, South32 is in talks to extend the supply, but no final deal has been reached.

With neighbouring South Africa desperate for electricity, particularly from green sources, there will be competition for HCB’s hydropower.

In the meantime, a new gas industry is quickly brewing in Mozambique. French company Total is planning to build a gas power plant in the same industrial park Mozal operates out of.

What does “unabated” fossil fuels mean?

A switch from hydro to gas power could cost Mozal its green credentials – and leave its exports to Europe facing high taxes.

A potential alternative source of renewable energy for Mozal could be the planned hydro plant Mphanda Nkuwa, on the Zambezi river downstream of HCB.

But there are doubts over whether construction of the dam will move forward as it is set to displace over a thousand people and climate change will dry up the river, making it harder to produce hydropower. Even if the plant is built, it will not be until 2031. 

Faten Aggad, an advisor at the African Climate Foundation, described the EU’s approach as “cold turkey” as it imposes “new norms in a context of poor renewable infrastructure investments coupled with weak emission accounting systems”.

This approach, she said, “risks promoting greenwashing rather than reducing carbon leakage”.

“The truth is that no country in Africa today will have the required renewable infrastructure ready for its industry to bypass the [carbon border tax] by [when it takes effect in] 2026”, she said.

A spokesperson for South32 said the company has “closely monitored” the tax and is assessing it “to evaluate the potential level of imapct and changes that may be required to our business processes, for example, our reporting system”. They added that Mozal has been provisionally certified by the Aluminium Stewardship Initiative.

This article was updated on 5 July 2023 to include more South32 comments.

The post Threat of EU carbon tax prompts dubious “green aluminium” claims in Mozambique appeared first on Climate Home News.

At climate talks in the German city of Bonn last week, governments negotiated how much money to give the UNFCCC for the next two years.

The UNFCCC wanted €83m ($91m) but governments could only agree to give it €74m ($81m), leaving its work at the mercy of what governments want to fund voluntarily.

Three sources in the room during negotiations told Climate Home that the European Union, one of the UNFCCC's major funders, would not allow any increase above this figure.

Ignoring inflation, its a 19% increase on the previous two years' budget. A spokesperson for the EU confirmed that the block "together with other Parties" supported a 19% increase.

One small island negotiator told Climate Home: "The big issue with the budget is that we agree as [governments] to mandates at Cops. We all make compromises and then 6-18 months later, in a sparsely-attended budget room, we decide on how much of those mandates get funded".

"It's inefficient and fundamentally unfair," the negotiator added, "all the power in the budget room is with the countries that contribute a lot".

Status quo

The budget increase is 19%, most of the extra money will be eaten up by inflation and by increases in staff salaries ordered by the UN's headquarters in New York.

The small island negotiator said it was "just maintaining the status quo" with "no new staff, no new capacity to fulfill the expanded mandates the [governments] have given the secretariat".

In his pitch for funds, Stiell said that, on top of its normal tasks, the UNFCCC has to help governments respond to the global stocktake of climate action, negotiate a new climate finance goal and submit new and improved climate plans in 2025.

The UNFCCC also wants to do more work to hold polluting governments and corporations to account, he said.

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Carrying out all its jobs will cost €131m, he said, so it will have to try and drum up more money, mainly from governments, on a voluntary basis.

Stiell said this funding is "unpredictable" which "jeopardises the delivery of mandated activities".

Relying on voluntary funding gives bigger and wealthier countries more power over what work the UNFCCC is able to carry out.

The UNFCCC does get some donations from private companies although there are restrictions on this.

If they don't receive enough extra funding, then work like organising a ministerial round-table on climate ambition in the 2020s could be jeoparised, as could engagement with companies and training on scrutiny of governments climate plans.

A spokesperson for the European Commission said: "The EU and its member states not only contribute a significant share to the core budget, but also make a contribution to the supplementary trust fund and to the fund that supports developing country travel."

The post UN’s climate work at risk, after EU limits budget increase appeared first on Climate Home News.

In a controversial move last year, the European Commission gave gas power plants a ‘sustainable’ label under the EU’s green finance taxonomy, provided they meet a strict CO2 emissions threshold.

Gas power plants will be considered as a “transitional” technology under the EU taxonomy provided they replace existing coal-fired power stations, and “subject to clear limits and phase-out periods”, the EU executive said.

That decision was challenged by four environmental groups – ClientEarth, WWF’s European Policy Office, Transport & Environment (T&E), and BUND (Friends of the Earth Germany).

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The four started legal action in September to stop the inclusion of fossil gas in the bloc’s sustainable finance rulebook, arguing that the legislation clashes with the European Climate Law and does not respect the EU’s obligations under the Paris Agreement.

However, in February the Commission rejected their request, and the NGOs are now challenging this decision by filing a case with the Court of Justice of the European Union. 

Absurd and unlawful?

“Labelling fossil gas as ‘sustainable’ is as absurd as it is unlawful. It goes against the EU’s own scientific advice and fundamentally undermines the credibility of the EU’s climate action. Fossil gas is not clean, not cheap and not a secure source of energy,” said a spokesperson for the four green organisations. 

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The NGOs argue that gas cannot be considered a sustainable source of energy and has a huge impact on climate change as it is a high-carbon source when burnt, while its extraction and transport also lead to the release of methane, a powerful greenhouse gas. 

Including fossil gas in the ‘green’ taxonomy would also worsen the EU’s dependency on imported fossil fuels, exposing EU member states to more price volatility, dependence on producing countries, and supply crises in the future, they add. 

“We’re taking the Commission to court in the hope of restoring some credibility to the Taxonomy and avoiding this huge risk to the climate and people’s energy security,” the spokesperson said. 

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Contacted by Euractiv, a Commission spokesperson said the EU executive “takes note of the legal action undertaken by several NGOs” but prefers not to comment on the substance of the case “before EU Court judgments are delivered”.

A hearing at the General Court is being scheduled for the second half of 2024, with a judgement expected to be released in 2025.

Nuclear challenged too

A separate lawsuit at the Luxembourg-based European Court of Justice against the inclusion of gas and nuclear in the taxonomy regulation will also be filed by Greenpeace on Tuesday.

In September, Greenpeace organisations from eight countries asked the EU to review its decision, but their request was rejected. 

As the lawsuit is being filed on Tuesday, activists from Greenpeace Luxembourg are planning to gather in front of the Court to protest the “green” label for gas and nuclear. 

Unlike gas, nuclear is a zero-carbon technology. But Greenpeace opposes it due to concerns over the disposal of nuclear waste and about safety and cost.

The post Campaigners sue EU for labelling gas sustainable appeared first on Climate Home News.

The EU bloc sees hydrogen made with renewable energy – known as “green hydrogen” – as a cost-effective way to reduce emissions, especially in industries that are difficult to decarbonise such as aviation and heavy land transport.

While the European industry is in its infancy, hopes of achieving short-term goals largely rest on production overseas. Countries, especially in Northern and Sub-saharan Africa, have been attracted by the sector’s opportunity for investments and new jobs, analysts told Climate Home News.

But experts warned the enthusiasm hides significant risks. Incentives built into the EU regulations mean the massive scale-up of green hydrogen exports could take up most renewable electricity in developing nations, at the expense of local populations.

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This would be a problem for countries like Namibia – one of the EU’s key hydrogen partners – where just over half of the population has access to electricity.

For Godrje Rustomjee, an analyst at the African Climate Foundation, countries need to find the right trade-off between domestic needs and export potential.

Otherwise, he says, the risk is that green hydrogen may turn into “another neo-colonial project”.

“There is a real possibility that foreign countries come in with direct investment, but all the benefits and added value end up being extracted and sent across to Europe”.

Marta Lovisolo, a hydrogen analyst at Bellona, says the risk developing countries will divert resources toward production for exports is “extremely high”.

“Green hydrogen is something Europe desperately wants and developing countries could potentially mass-produce for a lucrative market,” she says. “As it happened with fossil fuels, countries seem ready to stake everything on becoming exporters without being given the necessary safeguards.”

Very glad to meet President @hagegeingob

Namibia is a trusted partner of the EU. We stand by your side in the fight against the pandemic.
#GlobalGateway can support Green Hydrogen plans and sustainable raw minerals value chains.

Let’s develop a full-fledged partnership. pic.twitter.com/uU4HdYnIIO

— Ursula von der Leyen (@vonderleyen) February 18, 2022

Betting big on hydrogen

Despite being a nearly non-existing energy source today, green hydrogen has become a cornerstone of Europe’s decarbonisation plans.

Green hydrogen is mostly produced through electrolysis, a process that separates water into hydrogen and oxygen, using electricity generated from renewable sources.

The bloc has set a target of reaching annual domestic production of 10 million tonnes of renewable hydrogen by 2030 and importing the same amount. It is a tall order, considering that last year worldwide green hydrogen production capacity was 109 kilo tonnes – a fraction of what the EU wants to achieve.

Currently, most hydrogen is created using fossil fuels. Around three-quarters is derived from methane gas and a quarter from coal. Green hydrogen is more expensive to produce and accounts for less than 1% of total global production.

To fuel its ambition the EU is pouring billions of euros into the sector. Alongside investments in the build-up of domestic capacity, funds are being committed towards partnerships with future exporting nations.

The EU has signed agreements with a series of countries including Egypt, Kazakhstan, Morocco and Namibia. The partnerships are billed as a win-win situation.

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Rules exemption

The Commission has also recently set out the rules on renewable hydrogen. Among various provisions, it includes a criteria for developing renewable electricity called 'additionality'.

In the future, hydrogen producers will have to make sure that only new renewable electricity generation capacity is used for green hydrogen production. This is to ensure hydrogen production does not take away existing renewable energy from the grid, potentially increasing reliance on fossil fuels elsewhere.

Additionality can be achieved either by directly connecting a solar or wind farm to a hydrogen production facility or through purchase agreements with clean power generators.

But European lawmakers have included a phase-in clause to speed up the industry with the hope of meeting its 2030 goals. Any green hydrogen installation that starts production before 2028 will be exempted from the additionality rules for the following ten years, until 2038.

That means the projects developed before that date will be able to use already installed capacity, for instance taking clean energy directly from the grid.

Analysts say the rules have set off a race between exporting nations to meet the 2028 deadline. Namibia, for example, hopes to begin exporting green hydrogen in 2026, although analysts believe this will be very difficult to achieve.

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Risk of 'cannibalisation'

Maria Pastukhova, a senior policy advisor at E3G, says the rules allow hydrogen projects to “cannibalise” the existing local infrastructure for the purpose of export production.

“For many countries, especially in Africa, this energy is needed at home, where grids need to be decarbonised or local citizens don’t have access to electricity,” she added.

Only 56% of Namibians had access to electricity in 2022. The nation imported 60-70% of its electricity demand, most of it coming from fossil fuel sources.

The Southern African nation, in particular, is racing to become Africa’s first green hydrogen exporting hub, but faces a context of high unemployment and one of the most unequal economies in the world, according to the World Bank.

Namibia's pitch

Namibia’s President Hage Geingob sees green hydrogen as an “engine of growth” that will make the country an industrialised economy and create a large number of jobs.

“Because of our national green hydrogen efforts, Namibia remains well-positioned to become a major supplier of clean and green energy to the world,” he said at Cop27.

In 2021 the Namibian government began pitching its proposition to European leaders, luring them in with the promise to supply up to three million tonnes of renewable hydrogen every year.

Namibia's Tsau Khaeb National Park has been earmarked for green hydrogen projects. Photo: Olga Ernst and Hp Baumeler

Germany was first to respond to the calls and quickly partnered with its former colony. A German private joint venture is now working with the Namibian government to develop a $9.4 billion green hydrogen project. The huge infrastructure is expected to take up 4,000km2 of land (roughly four times the city of Berlin) within the Tsau Khaeb National Park.

Its goal is to begin hydrogen production by the end of 2026.

Money for hydrogen

Following Berlin’s lead, the European Commission signed a memorandum of understanding (MoU) with Namibia on renewable hydrogen, something they have also done in at least other three developing countries

The agreement aims to facilitate “the production and export of renewable hydrogen”, while offering Namibia the “possibility to achieve its own energy security and decarbonisation objectives”.

At the same time the European Investment Bank pledged to give Namibia a loan of up to 500 million euros to finance renewable hydrogen and renewable energy investments. The EIB President said “the development of a green hydrogen economy will bring Namibia and Europe closer together - as partners”.

A similar memorandum of understanding was signed on the sidelines of Cop27 between the European Union and Egypt. The partnership is aimed at "contributing to the EU future plans to import renewable hydrogen", while accelerating "the Egyptian energy sector's transition and decarbonisation".

The agreement does not yet contain any binding commitment but it expects to encourage investment in infrastructure and easier access to financing options.

Upon unveiling the deal, the European Commission Vice-President said Egypt is "ideally placed" to transport green hydrogen to Europe. He added that Egypt is blessed with "unlimited potential for solar and wind energy", which goes beyond local electricity needs and, therefore, can also be used for green hydrogen.

Despite this potential, the country's energy sector is still hugely dominated by fossil fuels, with only about 6% of the supply coming from renewables.

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Bellona’s Marta Lovisolo says the agreements are “full of nice words, but do not have any legal safeguards” to prevent European interests come first.

She adds developing countries are particularly attracted as the European Union has signalled it would subsidise the big premiums needed for green hydrogen.

More money to come

Brussels is working on a subsidy scheme to bring down the prices of hydrogen for buyers. Green premiums would cover the cost gap between renewable hydrogen produced overseas and the fossil fuels it would replace.

The money pot is expected to be large. The green premium to achieve the 2030 targets for hydrogen could come up to €115 billion in total.

For the African Climate Foundation's Godrje Rustomjee the financial incentives are just too good for developing countries to ignore. "On one hand they could use renewables only for domestic consumption but this could come at extreme cost," he says, "on the other, the nature of these export deals has the potential of doubling a country's economy".

The key, he says, it's striking the right compromise and securing safeguards in the deals with rich importing countries.

He believes these should include safeguards for local electricity provision and incentives, such as the localisation of manufacturing in the country.

The post Green hydrogen rush risks energy ‘cannibalisation’ in Africa, analysts say appeared first on Climate Home News.

Wedged between Brazil and Suriname, the overseas department has little in common with mainland France bar the name. The Amazon rainforest covers more than 90% of the territory.

However, French Guiana is critical to Europe’s soft power. It is home to the continent’s spaceport where the European Space Agency launches its satellites.

Now, the French government is seeking exemptions from proposed EU rules that would restrict the use of bioenergy on the territory. The loophole would allow French Guiana to receive public financing to produce biofuels “especially for the space sector”.

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Local lawmakers argue the dispensation is necessary to protect French Guiana’s forestry sector and accelerate its energy transition. But campaigners have warned the exemption risks setting an incentive for increased logging in Europe’s corner of the Amazon forest.

“Thousands of hectares of Amazon forest could be cleared to be replaced with monocultures designed to produce energy… with the help of public financing,” Marine Calmet, a lawyer specialised in environmental law at NGOs Maiouri Nature Guyane and Wild Legal, told Climate Home News

Rules for biofuels

The EU considers burning wood a renewable energy and subsidises its production. Bioenergy accounts for almost 60% of the EU’s renewable energy mix. But a mounting body of evidence is showing that burning wood emits more carbon dioxide than coal per unit of energy – worsening climate change.

Regrown trees may eventually remove the emitted carbon from the atmosphere but the process could take decades to a century – time which scientists say the world doesn’t have to prevent the worst impacts of global heating. To start addressing the issue, the EU is negotiating stricter sustainability criteria for producing and using bioenergy.

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Draft legislation adopted by the EU parliament proposed to exclude “primary woody biomass” – untransformed wood such as whole trees, logs and stumps – from receiving renewable energy subsidies, with limited exceptions. It also caps the amount that can count as renewable energy to current use.

Biomass from agricultural crops can’t be considered renewable if they are grown on land of great biodiversity value or replacing primary and ancient forests.

But French lawmakers introduced an exemption for “an outermost region where forests cover at least 90% of the territory”. It would allow biomass fuels and biofuels “especially used in the space sector” and regardless of their origin to receive public financing if they incentivise the transition away from fossil fuels.

Analysts told Climate Home French Guiana is the only known EU region where this could apply.

The Guiana Space Center is surrounded by 90% of forest covered territory in the Amazon. (Photo: CNES/ESA/Arianespace/Optique Video CSG/P Baudon)

Biofuels in the rainforest

The loophole would allow France to count woody bioenergy production in French Guiana towards its own renewable energy target – despite a cap in the rest of the continent. In 2020, France was the only EU member state to fail to achieve its renewable energy target.

Authorities in French Guiana argue the EU’s proposed rules threatened the territory’s goal to move away from fossil fuels, including at the spaceport, which consumes 18% of the electricity produced locally.

Two biomass plants, totalling 9MW, are being built to produce electricity and cooling for operations at the space station. By 2030, French Guiana wants 25% of its electricity mix to come from woody biomass.

Thibault Lechat-Vega, a local official responsible for European affairs, told Climate Home that halting subsidies to the sector would require the territory to import wood pellets from Canada and China “at a catastrophic carbon cost”.

EU plans restrictions on climate-wrecking fishing method

“There is clearly no question of cutting the forest to produce biofuels but to support research to green the European space launcher,” he said, adding that the logging sector in French Guiana followed some of the world’s strictest sustainability criteria.

Waste from forest clearance to give way to agriculture and to build homes and infrastructure would be used, he explained.

But Calmet said these assurances were insufficient. “Elected officials are providing no guarantees about the origins of the biomass. On the contrary, they want to contravene all legal obligations designed to protect primary and old forests, and ecosystems with high biodiversity value,” she said.

Cleaner rockets

While rocket launches account for a tiny fraction of the space industry’s emissions, a number of companies are developing greener propellants, including using biofuels. In French Guiana, researchers are working to scale up biofuels production from micro algae.

Andreas Schütz, a chemical propellant expert at the German Aerospace Center (DLR), told Climate Home that producing rocket fuels from wood, using a process known as gasification, is feasible.

But Mike Mason, an engineer who researched biomass at Oxford University, said the process was “very expensive” and that burning wood to produce electricity remains inefficient.

“Wood is a renewable resource but burning it has a global warming impact,” said Mason, warning of the risk of creating a precedent for climate-damaging activities in the Amazon.

Negotiations on the draft rules are ongoing. Sources close to the discussions told Climate Home that while the EU Council showed willing to accommodate France’s request, the Commission was concerned about the biodiversity impacts.

France recently closed a consultation on requesting the waiver. The government said “minimal environmental guarantees” would be put in place to limit tree clearance for energy production purposes.

The post France seeks EU loophole for French Guiana to power space sector with biofuels appeared first on Climate Home News.

The “EU Action Plan to protect and restore marine ecosystems for sustainable and resilient fisheries” is expected to be released in the first quarter of 2023 by the European Commission.

One of its flagship measures is to halt the destructive impacts of bottom trawling, a method of fishing that involves dragging heavy weighted nets across the sea floor in an effort to catch fish.

This fishing method stirs up greenhouse gases from the seabed, much of which escapes into the water and up into the atmosphere where it contributes to cliamte change.

A 2021 study found that six European Union countries were among the ten global nations with the largest bottom-trawling emissions inside their exclusive economic zone.

Under the draft plan, bottom trawling would be banned in Marine Protected Areas (MPAs) by 2030 but would still be allowed outside of those.

Deep sea trawling at depths greater than 800 meters was already banned across the EU in 2016, albeit with some exceptions.

Industry opposition

The action plan was first mentioned in the Commission’s Biodiversity Strategy for 2030 as a way to protect nature and reverse biodiversity loss.

It was initially expected in 2021 but was delayed several times after a public consultation revealed strong opposition from the fishing industry.

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Europêche, an industry group, said in was “appalled” by the Commission’s assertion that bottom contacting fishing gear was the most damaging activity to the seabed.

The commission’s strategy said: “By its very nature, mobile bottom fishing is among the least selective fishing methods and produces disproportionate amounts of unwanted cash and discards”.

But the industry association said in a response to a public consultation: “Dragging a fishing net through the water column or along the seafloor can be unsustainable if done so irresponsibly. But with proper management and careful placement, trawling can be very sustainable”.

Still, the draft plan warns that the European fisheries sector faces “existential threats” posed by climate change and biodiversity loss. It underlines that only a healthy marine environment will guarantee a prosperous future for fisheries communities.

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“Protecting and restoring Europe’s seas and oceans has become more essential than ever to counter the harmful impacts of the triple planetary crises of climate change, biodiversity loss and pollution on our economies and societies, including the fishing sector and coastal communities,” the document reads.

Protection shortfalls

As of today, only 12% of EU seas are designated as protected areas, and less than 1% are strictly protected, the document underlines.

This is way below the 30% protected, and 10% strictly protected, that the EU aims to achieve by 2030 as part of its biodiversity strategy for 2030.

The intention is also to address the shortcomings identified in the 2020 European Court of Auditors’ special report on the marine environment.

Many marine species and habitats are in poor state, the report underlined, concluding that European seas could not be considered as “healthy or clean” and that a high proportion of marine species and habitats assessments show “an unfavourable conservation status”, with fishing exerting the main pressure on marine ecosystems.

To address these issues, the action plan intends to act on four fronts:

• Improving fishing selectivity and reducing harmful impacts on sensitive species and their habitats;
• Minimising the impact of fishing – including bottom trawling – on sensitive habitats such as the seabed;
• Ensuring a fair and just transition in the fishing sector; and
• Strengthening research and innovation to integrate the concept of ‘natural capital’ in economic decisions.

NGOs respond

Conservation groups welcomed the Commission’s plan but argue that the draft falls short on several points.

“The Action Plan clearly states that we need to move away from destructive fisheries like bottom trawling, which is the first time the Commission is so clear about the problem, and we welcome this,” said Monica Verbeek, executive director of the marine conservation organisation Seas at Risk.

“The Action Plan also recognises the need for a just transition to low-impact fisheries, which we think is the only way to move out of the current failed system,” she told Euractiv in written comments.

But to achieve this, the plan relies mainly on the implementation of current environmental legislation and of the Common Fisheries Policy (CFP), which have so far “not delivered effective protection for marine species and ecosystems,” Verbeek argued.

Besides, the proposal to prohibit bottom trawling in marine protected areas (MPAs) by 2030 is a full seven years from now, NGOs point out, warning that it is counterintuitive to continue destruction until then in MPAs, which are areas in special need of protection.

“The Commission itself seems to recognise that the proposed measures will not do the trick, as they plan to assess progress in 2024 and already hint at a follow-up legislative proposal which will then conveniently be up to the next Commissioner to deal with,” Verbeek told Euractiv, referring to the fact that the Commissioner for the Environment, Oceans and Fisheries Virginijus Sinkevičius will end his term in 2024.

A version of this article was originally produced by Euractiv and republished under a content-sharing agreement.

The post EU plans restrictions on climate-wrecking fishing method appeared first on Climate Home News.

Between 1990 and 2020, an area larger than the EU was lost to deforestation, according to the UN Food and Agriculture Organisation. EU consumption is a big driver of this, causing around 10% of the losses, according to the FAO.

“The EU is a large consumer and trader of commodities that play a substantial part in deforestation – like beef, cocoa, soy and timber,” said Marian Jurečka the environment minister from the Czech Republic, which negotiated on behalf of the 27 EU countries.

“Protecting the environment around the world, including forests and rainforests, is a common goal for all countries and the EU is ready to take its responsibility,” he added.

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The new EU deforestation law will require all companies to issue a due diligence statement in order to sell products like coffee, cocoa and wood on the EU market. Those linked to deforestation will be banned from import and export into the EU.

“It is a text that has a real impact on our daily lives. We’re talking about very concrete items – your morning coffee or your morning chocolate,” said Pascal Canfin, the chairman of the European Parliament’s environment committee.

“The great specificity of this law – and this is a world first for palm oil, cocoa, coffee, beef, and rubber – is the obligation to have a certificate based on satellite images and GPS coordinates to know exactly where the commodity comes from,” Canfin explained.

“When you arrive on the EU’s internal market – at the port of Amsterdam or Le Havre – you must show this certificate. And if you don’t have it, you can’t go in”.

‘Groundbreaking’

The amount of inspections carried out will depend on the country of production, with the most high-risk countries seeing 9% of operators and traders trading products checked.

The new EU deforestation law was hailed as “groundbreaking” by green campaigners.

“We have made history with this world-first law against deforestation,” said Anke Schulmeister-Oldenhove, Senior Forest Policy Officer at WWF European Policy Office.

“The EU will not only change the rules of the game for consumption within its borders, but will also create a big incentive for other countries fueling deforestation to change their policies,” she said in a statement.

Greenpeace hailed “a major breakthrough for forests,” adding that the new EU law “will make some chainsaws fall silent and stop companies profiting from deforestation.” It regretted, however, that the regulation offers only “flimsy protection for the rights of Indigenous People who pay with their blood to defend nature”.

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The third round of negotiations between the European Commission, the European Parliament and the European Council started at 18:30 on Monday evening

After just over nine hours, the negotiators agreed that the law will cover a range of commodities, including cattle, cocoa, coffee, palm-oil, soya and wood as well as products that contain, have been fed with or are made using these commodities, such as leather, chocolate and furniture.

The European Parliament successfully widened the scope from the initial proposal, adding rubber, charcoal, printed paper products and certain palm oil derivatives to the list of commodities that require due diligence.

While biodiesel and maize are not included, the European Commission will review whether to add them in the future.

Redefining degradation

Another win for the European Parliament was to secure a wider definition of forest degradation, which now covers the conversion of primary forests or naturally generating ones to plantation forests.

This definition could also impact EU countries and was a “very bitter pill for the EU Council to swallow,” a parliamentary source told Euractiv following the agreement.

Alongside this, no later than one year after the law comes into force, the European Commission will need to evaluate whether to extend the scope to other wooded land.

And, no later than two years after the directive comes into force, the EU executive will need to look at extending the law to land with high carbon storage and biodiversity value, as well as other commodities.

The European Parliament had been pushing for areas, such as scrublands and savannahs to be covered, but the Council “vehemently opposed” this, said Delara Burkhardt, a German MEP who was in the Parliament’s negotiating team.

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“There is thus a danger that agricultural activities will simply switch from now protected forests to still unprotected savannah landscapes, as can already be observed in the South American Cerrado savannah,” warned Burkhardt, who is from the Socialists and Democrats (S&D) political group.

MEPs also succeeded in adding human rights protections. Companies will have to verify compliance with the country of production’s laws, including human rights and the rights of Indigenous Peoples.

However, this relies on the law of the country of production, which can vary in stringency.

Role of finance

One concession from the European Parliament was over the inclusion of financial institutions, which will not be directly obliged to analyse their investments for deforestation risks.

Instead, the European Commission will have to present an assessment two years after the law comes into force, looking at whether existing EU legislation is sufficient to tackle the role of financial institutions, like banks, insurance companies and pension funds, in global deforestation, explained Burkhardt.

Despite the concessions, she told Euractiv that the law sets “a global gold standard for due diligence requirements for deforestation-free supply chains”.

“Against the will of the Council of Ministers and the European forestry lobby, we managed to cover larger forest areas by improving the definition of forest damage. Against the tyre manufacturers’ lobby, we were able to include rubber, a major driver of deforestation, in the regulation. And we were able to strengthen the role of indigenous communities,” she added.

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The lead negotiator for the European Parliament, Christophe Hansen from the European People’s Party, also praised the deal.

“This important new tool will protect forests globally and cover more commodities and products such as rubber, printed paper and charcoal. Moreover, we ensured that the rights of indigenous people, our first allies in fighting deforestation, are effectively protected,” he said.

The law will enter into force 20 days after its formal adoption by the European Parliament and EU countries, expected next year, but will not apply to big and medium sized companies until 18 months and micro and small companies for 24 months.

This article was produced by Euractiv and republished under a content sharing agreement.

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Tuesday’s deal is part of a wider €300 billion ($300bn) plan tabled by the European Commission in May to speed up the energy transition in the wake of Russia’s military aggression in Ukraine.

“Today we achieved a major step forward in strengthening Europe’s autonomy from Russia’s fossil fuels,” said Zbyněk Stanjura, the finance minister of the Czech Republic, which holds the rotating EU presidency.

“Given the geopolitical context since Russia started its military aggression against Ukraine, and given the latest attacks on energy infrastructure in Europe, I am sure it is necessary to push for a fast agreement on this proposal,” he added.

The proposal will add a new energy chapter to the national recovery plans approved by the European Union to restart the economy in the wake of the Covid-19 crisis two years ago.

But how to fund this spending without compromising other green objectives is hotly debated between the EU’s institutions and has yet to be decided.

Carbon price kept high

The European Commission originally suggested releasing carbon credits from the market stability reserve. This reserve was established in 2015 to keep the carbon price high to incentivise emissions reductions.

But EU countries like Germany, France, the Netherlands and Denmark, were opposed to the idea, said Agnese Ruggiero from Carbon Market Watch, a green NGO. And in the European Parliament, all the main political groups are also fiercely against.

With its proposal, the European Commission probably tried killing two birds with one stone by raising funds and addressing calls from eastern EU countries to tackle high prices on the carbon market, Ruggiero said.

But the proposal risked causing a negative spiral as releasing more allowances would depress prices on the Emissions Trading Scheme (ETS), requiring more allowances to be released to hit the €20 billion ($20bn), she explained.

Experts also criticised the Commission’s plan, saying it would undermine trust in the ETS at a time when the EU needs a high carbon price to sustain the bloc’s more ambitious decarbonisation targets for 2030.

EU countries set for clash with Parliament

Instead, EU ministers backed a combination of funds, including drawing 75% of the €20 billion ($20bn) from the Innovation Fund and 25% from the early sale of carbon allowances (frontloading).

Although more allowances would be sold in the short term, there would be no new CO2 allowances added to the ETS, raising pressure on EU countries to accelerate emissions reductions in the second half of the decade to hit the bloc’s 2030 goal.

But the European Parliament rejected the idea of using the Innovation Fund and would rather draw the €20 billion from the regular pool of emission allowances.

“We strongly disagree to have the main bulk of the money from the innovation fund because we need the fund to support the transition of the industry,” said Peter Liese, a German MEP who is the lead negotiator on the ETS reform in the European Parliament.

“This is completely unacceptable for us. And we will fight hard against this proposal” during final talks with EU member states, he added, saying member states like France and Netherlands were on the Parliament’s side.

Using the Innovation Fund

Last week, Liese presented a common position on the issue with the Parliament’s four biggest political groups – the centre-right European People’s Party (EPP), the left-wing Socialists and Democrats (S&D), the centrist Renew Europe (RE) and the Greens.

Despite the Parliament’s concerns, Federico Sibaja from think-tank Sandbag said drawing money from the Innovation Fund also brings benefits.

“Those resources would be better spent than the way they’re being spent right now as the projects from the Innovation Fund are really focused on innovative technologies that may actually not be deployed in the next years to come. While actually the money from the recovery funds will be spent for mitigation strategies right away,” he explained.

The scope of the Innovation Fund should also be addressed in wider discussions about reforming the carbon market, he added.

However, it is not yet clear whether the negotiations will take place as part of the wider carbon market reform, which would allow trade-offs in negotiations within the topic, or if it will be tackled in separate negotiations.

The European Parliament is expected to vote on its position in November. It will then negotiate the plan with EU countries.

If adopted, the Parliament’s “frontloading” proposal would leave EU countries with fewer allowances until the end of the decade, which means pressure to decarbonise “will be even higher” as the EU gets closer to 2030, Liese said.

“That’s why member states are not so happy,” he added.

The European Commission hopes to have the proposal adopted by early next year.

This article was originally published on Euractiv and has been lightly edited for clarity.

The post EU ministers back €20 billion plan to ditch Russian fossil fuels appeared first on Climate Home News.

A motion to veto the European Commission’s proposal to include nuclear and gas in the EU’s sustainable finance taxonomy was defeated by 328 votes to 278.

A minimum of 353 votes was needed to reject the plan, which means it is now officially approved by the European Parliament.

Objection to the inclusion of nuclear and gas in EU green finance taxonomy is rejected: 278 votes in favour, 328 votes against.

This means the proposal goes through: nuclear and gas are now officially recognised as “transitional” activities under the taxonomy. pic.twitter.com/G6se90ZUoi

— Frédéric Simon (@FredSimonEU) July 6, 2022

Before it becomes law, the proposal to include nuclear and gas in the EU’s green finance taxonomy must also face a vote in the EU Council of Ministers representing the EU’s 27 member states.

However, a majority of 20 countries is needed to veto the proposal in the Council, which makes a rejection highly unlikely.

Reacting on Twitter, the energy minister of Luxembourg said he would challenge the decision before the EU Court of Justice.

“Luxembourg and Denmark will press legal charges and the Court will rule about its legality,” wrote Claude Turmes, saying he deeply regrets the Parliament’s decision.

Protestors in the hemicycle reacted immediately after the vote, wearing T-shirts reading “betrayal” and calling MEPs “traitors”.

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Michael Bloss, a German Green MEP, denounced the “madness” of labelling nuclear and gas as sustainable investments, saying it will keep Europe addicted to Russian fossil fuels for many more years.

“France’s nuclear reactors and waste dumps will be renovated and new fossil gas infrastructures created,” Bloss said in a statement. “No serious bank will trust this taxonomy,” he added, saying the Greens were now preparing to take legal action against the decision.

Greta Thunberg, the teenage activist who started the Fridays for Future movement, reacted coldly on Twitter, saying the vote will delay the green transition and “deepen our dependency on Russian fuels”.

“The hypocrisy is striking, but unfortunately not surprising,” she wrote.

The European Parliament just voted to label fossil gas as “green” energy. This will delay a desperately needed real sustainable transition and deepen our dependency on Russian fuels. The hypocrisy is striking, but unfortunately not surprising.
This is still #NotMyTaxonomy

— Greta Thunberg (@GretaThunberg) July 6, 2022

Pascal Canfin, a French MEP who chairs the Parliament’s environment committee, sought to assuage the concerns of green activists, reminding them that the taxonomy does not give a blank cheque to all gas investments.

“The conditions set by the taxonomy for gas are precise: gas is only possible to replace coal, until 2030, under emission thresholds that are not considered dangerous and with reinforced transparency obligations,” he wrote on Twitter.

Nuclear Europe, an industry association, congratulated MEPs after the vote, saying Parliament had taken a “science-based decision” to include nuclear in the taxonomy.

“It is fantastic to see that a majority in the European Parliament has decided to listen to the experts and take the right decision,” said Yves Desbazeille, director-general of Nuclear Europe.

“We have less than 30 years left to decarbonise our economy in a sustainable way. By listening to the science, these MEPs have strengthened the EU’s chances of achieving this ambitious goal.”

Eurogas, an industry lobby group, was also cheerful, saying the Parliament’s decision “provides a decent framework” for future investments.

However, it said the European Commission’s taxonomy proposal “could have done more to promote coal phase-out and the adoption of best-in-class technologies” such as hydrogen and renewable gases.

“It is also crucial that we overcome bottlenecks for imports of diversified natural gas and LNG [liquified natural gas], and renewable hydrogen,” said James Watson, secretary-general of Eurogas.

This article was produced by Euractiv and republished under a content sharing agreement.

The post EU set to use ‘green’ label for gas, nuclear investments after parliamentary vote appeared first on Climate Home News.

Under a “flexibility mechanism” approved by members of the energy investment treaty, the EU and UK will end protection for new fossil fuel investments from August 2023. However, most existing fossil fuel investments will continue to be protected for 10 years from the date the modernised treaty is officially ratified.

The ECT, which has members spanning Europe and Asia, has been used by fossil fuel companies to sue governments over climate policies which hurt their profits. For example, German energy company Uniper is suing the Dutch government over its coal phase-out plans.

In 2020, a study found that ECT member countries faced up to €1.3 trillion ($1.4trn) by 2050 of compensation claims by fossil fuel investors.

The EU initiated “modernisation” talks to try and end these lawsuits but its attempts to remove fossil fuels from the treaty’s protection clause were thwarted by some Asian nations led by Japan.

At an ad-hoc conference, which was disrupted by protesters yesterday, members to the treaty reached a compromise which gives them some flexibility to choose what energy investment they want to continue to protect.

STOP PROTECTING FOSSIL FUELS! Extinction Rebellion & @wemoveEU have blocked the entrances to the toxic fossil fuel treaty (the ECT) building with a climate crime scene.
4 years of talks on the ECT must end today with the only viable conclusion: end the ECT now! #NoECT #ExitECT pic.twitter.com/iGFaA9Tx9L

— Extinction Rebellion Belgium (@XR_Belgium) June 23, 2022

Members like Japan, a staunch defender of the ECT, is likely to keep protecting fossil fuel investments in the country indefinitely. But the EU and the UK have said they will use the flexibility mechanism to limit them.

When the EU and UK end protections for fossil fuel investments for fossil fuel investors from ECT states like Japan then those states are likely to reciprocate, meaning European and British fossil fuel investments will no longer be protected in countries like Japan.

In Europe, environmental campaigners, who have repeatedly called on the EU to leave the treaty, reacted angrily, calling on ECT members to stage an on-mass exit from the treaty despite the reforms.

Former ECT employee turned anti-ECT campaigner Yamina Saheb told Climate Home the agreement was “a disaster from a climate change perspective”. Friends of the Earth’s Paul De Klerck said it would “lock the EU in fossil fuel investment protection” for a decade.

“This means countries will continue to spend taxpayers’ money in compensating fossil fuel companies rather than fighting climate change and moving to a renewable energy system,” added Cornelia Maarfield, trade and investment policy expert at Climate Action Network Europe. “This disastrous agreement must not be ratified,” she said.

Japanese and Korean industry push gas on Vietnam amid campaigner crackdown

The ten year protection for existing coal, oil and gas investments was a compromise reached between EU member states, which diverged on the best way forward, according to sources familiar with the negotiations. France, Spain and Luxembourg wanted to end the protection of fossil fuel investments that allows countries to be sued for damages by polluting companies. But several Eastern European states resisted change.

Under the agreement reached, some gas-fired power plants will continue to receive investor protection beyond the 10-year deadline and until the end of 2040. That applies to gas power plants whose emissions are under a certain level and which replace more polluting infrastructure.

The flexibility mechanism would have allowed the UK to end all fossil fuel protection immediately. But it hasn’t done so. Asked why, an energy ministry spokesperson declined to comment.

In a statement published Friday, the UK said protection for existing coal investments in the country will end in October 2024. But, in line with the EU, it will wait 10 years to end protection for oil and gas investments. It will continue to protect abated gas, which uses carbon capture technology, beyond those 10 years.

“Our success in negotiating a modernised treaty will boost our move to cheaper and cleaner energy by providing greater confidence to the private sector investors and risk takers we need for this transition,” said UK energy secretary Greg Hands.

Colombia’s new president Gustavo Petro pledges to keep fossil fuels in the ground

Campaigners’ call to leave the treaty found some sympathy in EU member states. A Spanish government representative told an EU council meeting in April that Spain “did not see how the ECT could be adapted to the Paris Agreement” and deputy prime-minister Teresa Ribera recently told Politico: “It is time that the EU and its member states initiate a coordinated withdrawal from the ECT”.

But the treaty’s ‘sunset clause’ makes leaving difficult as its rules continue to apply for 20 years after a member decides to leave. Campaigners say the impact of this sunset clause can be greatly reduced if members withdraw on mass and refuse to implement the treaty against each other during that time.

But as well as protecting fossil fuels, the treaty protects renewable investments. Under its rules, renewable companies have claimed compensation for anti-renewable measures. The modernisation talks have led to the addition of protection for carbon capture and storage technology, hydrogen, , ammonia, biomass and biogas.

This article was updated to include the UK government’s decision not to comment.

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European and other rich nation negotiators believe they have shifted dramatically in recognising the need for funding in addition to that for carbon-cutting and adaptation efforts.

One developed country negotiator told Climate Home: “One year ago, I wouldn’t have been allowed to say ‘loss and damage’…a lot of progress has happened in the last year or so”.

But despite showing more willing to address the issue, the gap between rich nations and developing countries’ position remains glaring. During the Bonn climate talks, which closed Thursday, the EU led resistance to developing countries’ demand for a bespoke loss and damage facility and for that to be on the formal agenda at Cop27 in Egypt.

“The fact is that the EU is still unable to grasp the scale of harm that climate impacts cause in the Global South nor of its direct responsibility on loss and damage,” said Adrián Martínez Blanco, of the Costa Rican campaign group Ruta Del Clima. 

Rich nations have avoided setting out an alternative solution to the loss and damage facility demanded by developing countries. Climate Home approached five wealthy country delegations in Bonn, none of whom wanted to discuss the issue on the record.

Patricia Espinosa: Some rich nations felt demands on finance were ‘too strong’

At Cop26, in Glasgow, UK, last year, developing countries were pressured by wealthy nations into settling for a three-year ‘dialogue’ on funding arrangement for loss and damage, with no decision-making powers.

Developing countries’s attempt to push the issue on the formal agenda for the Cop27 talks this November have so far been unsuccessful and consultations on the issue will continue. In response, they appealed directly to the UN climate head Patricia Espinosa to intervene on their behalf.

Under current plans, the discussions will remain a ‘dialogue’ which is due to end in June 2024. The next session isn’t planned until June 2023. Vulnerable nations say they cannot afford to wait two more years to have certainty on funding arrangements. 

Alex Scott, of think tank E3G, said progress at the talks was “divorced from the climate impacts that are hitting on the ground outside this venue, outside these negotiations”.

“No more blah blah blah. Loss and damage finance now.”

“Put loss and damage on the agenda.”

Final message from campaigners at the #BonnClimateConference pic.twitter.com/8dTINNJYwX

— Chloé Farand (@ChloeFarand) June 16, 2022

However, some rich nations have been more forthcoming about promising hard cash outside of a funding facility.

New Zealand’s climate ambassador Kay Harrison told the meeting last week: “There should be no question – climate finance must be available to avoid, minimise and address loss and damage… we think the solutions may lie in bilateral, regional and multilateral solutions”. She added this needed to be done “urgently” and without “delay and procrastination”.

On Friday, a foreign ministry spokesperson told Climate Home that “New Zealand is developing a strategy for delivering climate finance to support our partners’ climate action, including addressing loss and damage”. If it happens, New Zealand would become the first UN-recognised country to provide explicit loss and damage finance.

Representatives of Australia’s new government, keen to build links with their climate-vulnerable Pacific neighbours, supported New Zealand’s position.

Denmark’s chief adviser on climate diplomacy Frode Neergard said: “Current financing mechanisms do not recognise the urgency of loss and damage and the need to act now. It’s a drop in the ocean. Existing finance mechanisms are overwhelmed.”

Island states say fund for climate disaster victims must be created by Cop27

A recent Oxfam report found that for every $2 needed for UN extreme weather-related appeals, donor countries are only providing $1. The World Food Programme recently scaled down its work in South Sudan because of lack of funds, leaving up to 1.7 million people at risk of starvation. 

Alpha Kaloga, lead negotiator for the African Group on loss and damage, told Climate Home that besides from being insufficient, humanitarian aid and disaster relief doesn’t provide equal support to all countries, with some getting more help for geopolitical reasons. Friends and families of victims, often poor themselves, have to pick up the slack when aid money doesn’t cover needs, he added. 

To address this funding gap, Germany, supported by the US, has proposed a ‘global shield’ which aims to provide targeted support to a select number of particularly vulnerable countries. It will push this idea when it hosts the G7 leaders’ summit later this month and the Petersberg  Climate Dialogue in July.

China rejects ‘major emitter’ label in talks to step up climate action

But, throughout the talks, the US and the EU insisted that existing aid schemes could be increased and improved to address countries’ loss and damages needs. 

“We think the next set of our process should focus on how existing resources can be strengthened,” the EU’s lead negotiator Jacob Werksman told the meeting. 

Climate Home understands that, after years of avoiding the issue, the EU feels politically exposed by its recent recognition that loss and damage needs to be addressed with funding but its failure to provide an alternative to developing countries’ proposed facility. 

Under the governance of UN Climate Change, they bloc argues the fund would be bureaucratic, slow to set up and won’t resolve the quality of finance, such as the share of loans versus grants. In private, some EU negotiators further recognise that there are no compensation mechanisms for slow-onset events, such as sea level rise, or the loss of culture, language and traditions because of climate impacts. 

But not every capital is ready to face the consequences of ramping up existing aid. In fact, the UK has cut its development aid in the wake of the pandemic. “Every country has this fight between the climate ministry and the ministry of finance,” said the developed country official.

The post EU blocks bespoke fund for climate victims as rich nations moot alternatives appeared first on Climate Home News.

Observers say the European Commission’s decision to classify gas as a transition fuel in its green investment list leaves the door open to “blue hydrogen” projects with exaggerated climate credentials.

“Blue hydrogen is basically nothing but a smokescreen for more air pollution, mining, and fossil fuel use with hardly any CO2 benefit,” said Mark Jacobson, professor of civil and environmental engineering and director of the Atmosphere/Energy Program at Stanford University.

Unlike green hydrogen, which is derived from water in a process powered exclusively by renewable energy, blue hydrogen comes from methane, with the carbon dioxide emitted during production captured and stored.

The International Energy Agency reported last week that there are at least 50 blue hydrogen projects under development globally, and capacity is set to increase more than tenfold by 2030.

European Commission endorses fossil gas as ‘transition’ fuel for private investment

In a delegated act last year, the EU Commission set an emissions threshold of just over 3 tonnes of CO2e per tonne of H2 for hydrogen projects to comply with the green taxonomy.

“Which is not low enough to guarantee that it would be only renewable energy-powered hydrogen,” said Eleonora Moro, a hydrogen analyst at the E3G climate think tank. “It could include some types of high efficiency blue hydrogen projects.”

One such project is a joint venture announced by Equinor and Engie in December to produce “low-carbon hydrogen… at large scale and at competitive cost levels”. The companies claim that they will use a process known as autothermal reforming (ATR), which “allows for decarbonization rates above 95%”.

The project sponsors some editions of POLITICO’s Brussels Playbook newsletter, telling readers: “Hydrogen can accelerate the energy transition but we need to develop well-functioning markets and infrastructure. The H2BE project will help kick-start the Belgian low-carbon hydrogen market.”

Seven countries join US and EU in methane reduction pledge

ATR involves heating methane gas with a catalyst, then adding water to get hydrogen and CO2 that is then captured. Equinor says it will bury the captured CO2 beneath the North Sea. 

The EU’s hydrogen strategy, published in 2020, says that “renewable  and low-carbon hydrogen can contribute to reduce greenhouse gas emissions ahead of 2030”.

Jacobson disputed Equinor and Engie’s claim that blue hydrogen can be classified as “low-carbon”.

“Carbon capture equipment is never 95% effective,” he told Climate Home. Blue hydrogen capture technology currently available is at best 78.8% effective, “but that ignores the fact that more energy is needed to run carbon capture equipment, so it is 78.8% of a much larger emission stream”. 

Jacobson co-wrote a study last year which found, due to the increased amount of fossil gas needed to power the carbon capture and storage (CCS) process, blue hydrogen likely had a 20% higher carbon footprint than burning methane alone.

Comment: Why the hydrogen bubble could burst in Europe’s face

A paper by different researchers last month noted that developers’ promises of a 90-95% CCS success rate were based on theory, not practice. 

“While these high capture rates are assumed in many national strategies and major reports, they have not yet been achieved in a large-scale commercial plant,” said the paper, published in the journal Applied Energy. 

Another issue with blue hydrogen projects is that the methane feedstock can leak, with a short-term warming impact more than 80 times that of CO2.

Countries agreed at the last UN climate summit in November to reduce methane emissions by 30% this decade, and an EU Commission proposal seeks a ban on routine gas flaring and venting as well as penalties on leaks. 

Yet the draft legislation doesn’t set specific emissions reduction targets, and E3G’s Moro said leakages – which may be as much as 4% in some countries – could only be penalised if effectively observed. 

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Eilidh Robb, an anti-gas campaigner at Friends of the Earth Europe, said that industry’s focus on blue hydrogen “shows a complete lack of understanding about methane emissions”.

“We talk so much about CO2 that methane has been overlooked and it’s only now we are starting to talk about that,” she said. “[Blue hydrogen] is a highly technological solution from the gas industry for them to continue to do what they have always done and we need to be deeply skeptical.”

A spokesperson for Equinor told Climate Home that in order for the EU to reach its decarbonisation aims, it “will need many forms of hydrogen with zero to low-carbon and environmental footprint. The volume needs are massive.”

The spokesperson added that Equinor “pursues a methane intensity target of near zero and are an engaged member of international efforts to reduce global emissions”.

Engie did not respond to comment requests.

Researchers also questioned if burying CO2 beneath the sea bed was a durable solution to the climate crisis. 

Caitlin Swalec, research analyst and hydrogen specialist at the Global Energy Monitor watchdog, said that no matter how well it is stored, buried CO2 will “eventually leak and make its way back to the atmosphere”.

“This may happen over several hundred years, or a few decades. We don’t really know because we haven’t tested it,” she said.

The Intergovernmental Panel on Climate Change, in its 2005 special report on CCS, suggested that CO2 stored below 3,000 metres would be less likely to leak. At this depth, the gas becomes denser than water.

Saudi energy minister touts pink hydrogen made by “emancipated young ladies”

Equinor says it stores its captured CO2 “1,000-2,000 metres below the seabed” and Swalec said it was not clear how viable the storage was at such depths. 

“In order to store CO2 long term under the sea floor, it needs to go very deep which means that it will require a lot of energy to store it,” she told Climate Home. “If it takes more energy (i.e. emissions) to store the CO2 than we remove, the project will cause more problems than it solves.”

Silje Ask Lunberg, a senior campaigner and Norway expert at Oil Change International, said Equinor – previously Statoil – had a history of failed CCS attempts. 

These include problems at its Snohvit field in the Barents Sea, which saw one attempt at CCS aborted as the reservoir was at risk of collapsing, and a second paused as the injected CO2 was polluting the methane extracted from the site.

Statoil also mothballed its Mongstad CCS plant after less than a year of operations.

“Mongstad was meant to demonstrate that it was completely feasible to have carbon capture at gas-fired power plants and it was supposed to be 100% from 2014,” said Lundberg. “They ended up failing at their own project.”

EU climate package risks locking in gas use, campaigners warn

Equinor and Engie say they are in talks with potential blue hydrogen buyers from “predominantly large, hard-to-abate industries”. These may include sectors such as cement and steel, where there are few low-carbon production methods.

The EU green taxonomy also encourages the use of hydrogen in gas-fired power stations, while gas grid operators are preparing to “blend” hydrogen into the fuel mix for home heating and cooking.

E3G’s Moro said that even for hard-to-abate sectors, there were “much more efficient alternatives”, such as renewable energy or green hydrogen.

She said there were “very strong economic interests” pushing for blue hydrogen across Europe, and that the guidelines as to what qualifies as renewable or low-carbon gas were too vague, as they stand, to discourage them.

“We know that fossil gas will have to be phased out in the EU so what do we do with all that infrastructure? The easy solution the fossil industry is selling is blue hydrogen.”

This article was amended after publication to add a response from Equinor. 

The post Experts sound the alarm on oil sector’s blue hydrogen push appeared first on Climate Home News.

The guidelines seek to align EU state aid rules with the European Green Deal, focusing on supporting renewable energies and attaining the bloc’s climate objectives.

If an EU government wants to fund a project that is not in line with the EU’s 2030 or 2050 climate targets, “the balance is not likely to tip in favour of supporting it with aid,” said EU competition chief Margrethe Vestager who presented the new rules.

The guidelines also include a new section on aid for the closure of coal, peat, and oil shale plants to facilitate decarbonisation in the power sector, the EU executive said in a statement.

Once formally adopted early next year, the new guidelines will immediately apply to all EU legal texts. EU member states will have until 2024 to align their existing aid schemes with the new requirements.

The guidelines broaden the scope of areas exempted from the EU’s usually strict state aid rules, supporting new players in the energy field such as small scale renewable energy producers, Vestager explained.

Other new areas covered include government support to improve the energy performance of buildings and clean mobility, such as infrastructure for electric vehicles, clean vessels and aircraft.

UK floats ‘climate compatibility’ test for new oil and gas drilling

However, the new guidelines also inject “a bit of pragmatism” into state aid rules, added the Danish commissioner who singled out natural gas as “a special case because for now, it acts as a bridge towards our path to more renewables.”

“But a bridge is not a destination, and state aid decisions will reflect hat logic. Our goal is and will remain phasing out our reliance on fossil fuel. And that includes gas,” Vestager insisted.

When pressed by reporters to elaborate further, the Danish commissioner said a “special clause” will apply to natural gas allowing for “member states with the lowest GDP to transition from coal to gas. Because they kind of need a helping hand in order to do so.”

That comment is likely aimed at EU countries like Poland, Greece, and Romania, which are heavily reliant on coal and planning investments in gas projects to displace it.

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Key criteria for fossil gas projects to win EU state aid approval is whether they are future-proof and ready to accept higher shares of green hydrogen or biogas. They must also prevent a lock-in effect into polluting energy by demonstrating a clear pathway to decarbonisation.

“We cannot have gas with a lock-in effect,” Vestager said. “We can make necessary pragmatic exceptions, but it still has to contribute to our green target,” she explained.

Regarding state aid for nuclear, Vestager said that it would continue to be assessed under the 1957 Euratom treaty, which provides a legal basis for EU support to nuclear safety and research projects.

The revised state aid guidelines could play an indirect role for nuclear though, “for instance when hydrogen is produced with nuclear” power, Vestager said. “And that is in the guidelines”.

Drought-hit town hopes Chile’s new leader will take back water from Big Avocado

Notably, the new state aid guidelines will allow governments to support any clean technology with so-called Contracts for Difference, which entitle the beneficiary to a payment equal to the difference between a fixed ‘strike’ price and a reference price – such as the price of CO2 on the EU carbon market.

“For example, if you’re an energy provider and the market price is below that strike price, then the state pays you the difference,” Vestager explained. If the market price is above, the beneficiary then pays back the difference to the state. “And that ensures stable and predictable revenue streams,” she said.

Contracts for difference were first tested in Germany, which pioneered the scheme last year as part of its €7 billion hydrogen strategy. The scheme is supported by German industry association BDI, which sees it as financing clean technologies in energy-intensive industries like chemicals, cement, and steelmaking.

This story was produced by Climate Home News’ media partner Euractiv. 

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Recently, fossil fuel companies have used the ECT to sue the Slovenian government over environmental protections and challenge the Dutch government‘s coal phaseout plan. The firms have argued that green government policies unfairly damage the value of their assets.

Similar cases could cost taxpayers across the world up to €1.3 trillion ($1.5tn) by 2050, according to the Open Exp think tank, based on the value of fossil fuel assets protected by the treaty. Just under half of these costs would fall on the EU.

The EU has been pushing for green reform of the treaty but all 53 ECT countries need to be on board for changes to be made and Japan and Central Asian countries have blocked reforms.

Speaking on Monday, the European Commissioner for energy Kadri Simon said that “greening” was “at the heart of the [ECT] modernisation process”.

A leaked European Comission proposal for ECT reform proposes removing coal, oil and gas from the energy investments protected by the treaty. If approved, this rule change would come into force in ten years time and investments made in the meantime would not be protected.

Environmental campaigners said the Commission’s proposal was too slow and had too many loopholes, particularly on gas. Paul de Clerck, from Friends of the Earth Europe accused the EC of “blind pandering to fossil fuel interests” by “protect[ing] fossil fuels for at least another ten years”.

The EC’s proposal says that investments in gas made before 2030 should be protected if they emit less than a certain amount of CO2 and if their plants and infrastructure enable the use of low-carbon and renewable gases. The EC adds that investments in coal-to-gas conversions or gas pipelines which can carry low-carbon and renewable gases should be protected until 2040.

Poland’s largest utility announces pivot from coal to renewables

The document also proposes that investments in hydrogen and materials used to insulate buildings should be protected. Hydrogen can be renewable or non-renewable depending on how it is produced.

Amandine Van Den Berghe, trade and environment lawyer at ClientEarth said the Commision’s proposal was “a step in the right direction but contains major loopholes around gas and non-renewable hydrogen, which increase the risk of locking in gas infrastructure and more future emissions”.

Yamina Saheb used to be the head of the ECT energy efficiency unit and now monitors negotiations. She said that on Thursday, the document will be discussed by the European Council’s energy working party, which is made up of representatives of the EU’s member states.

Peru and Switzerland sign ‘world first’ carbon offset deal under Paris Agreement

Saheb said that the proposal was submitted too late to be discussed at next week’s ECT negotiations and so won’t be discussed at all this year. The next round of negotiations is scheduled for February or March 2021. Saheb said that although the EC’s proposal is “weak from a climate perspective”, the other ECT member states will still reject it.

Saheb and De Klerk argue that, instead of pushing for reform, the EU should leave the ECT. States like Luxembourg and France have said the EU should consider leaving and Italy and Russia have already left.

The treaty’s ‘sunset clause’ means that, even if the EU states left, the ECT’s rules still apply for 20 years. Commenting on whether this made reform better than leaving, Saheb said that 80% of energy investments in the EU are from fellow EU or EFTA countries so, when they leave, these countries could also agree to end the sunset clause between themselves. They should then plan carefully so as to avoid legal cases over the 20% of investments from outside of Europe, she said.

This article was amended to say that Italy and Russia have left the ECT. Previously, it said they had started the process of leaving.

The post EU tries to stop fossil fuel companies suing states over climate action appeared first on Climate Home News.

In the past year, fossil fuel companies have used the Energy Charter Treaty to sue the Slovenian government over environmental protections and challenge the Dutch government‘s coal phaseout plan.

Similar cases could cost taxpayers across the world up to €1.3 trillion ($1.5tn) by 2050, according to the Open Exp think tank, based on the value of coal, oil and gas assets protected by the treaty.

Around 42% of these costs would fall on the EU. The bloc is pushing for amendments of the treaty to support climate goals, including replacing the investor state dispute settlement (ISDS) model with something more transparent.

But at “modernisation” talks between the 53 signatories of the pact last week, Japan and central Asian countries refused to entertain fundamental changes to the ISDS system.

Japan blocks green reform of major energy investment treaty

In its statement on the talks, the ECT secretariat said: “No consensus was reached on a request by one delegation to discuss a broader reform of ISDS beyond the list of topics for modernisation.”

Investment law expert at the Columbia Center on Sustainable Investment Lise Johnson told Climate Home News the talks were “a missed opportunity” and “risk locking in the same unsustainable status quo”.

Harro van Asselt, climate law professor at the University of Eastern Finland, said replacing the ISDS is just one of several possible ways of ‘greening’ the ECT. “Such proposals could still be pursued under the current list of topics for modernisation. However, the unwillingness by some parties to even discuss these issues does not bode well for reform efforts,” he concluded.

Proposals still on the table include measures to deter frivolous claims and regulate the role of “no win, no fee” litigation finance companies.

Kyla Tienharaa, assistant professor of environmental studies at Canada’s Queen’s University said if fully pursued, these changes might help prevent lawsuits by fossil fuel companies bankrupted in the transition to clean energy. But negotiators were merely “tinkering” and “ultimately, in my view, termination [of the treaty] is the way to go”.

Friends of the Earth campaigner Paul de Clerk said the decision not to discuss broader reform, shows “the ECT will continue to promote an ISDS model that was declared unacceptable by the EU and its member states a couple of years ago. Therefore, it is time to leave the ECT.”

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Several European politicians have said the EU should consider pulling out of the treaty if it doesn’t achieve meaningful reform. Italy and Russia left the ECT after legal action was brought against them, although a ‘sunset clause’ means the treaty’s provisions apply for 20 years after the exit date.

The head of the ECT secretariat, Urban Rusnák, has said that if modernisation talks fail, there is no future for the treaty. But he insisted it could be a positive force for climate protection in a June interview with Borderlex.

“Apart from the Yukos case, damages awarded under arbitration cases up to now are twice as high in the renewable energy sector as in fossil fuels. Yet somehow the NGOs fail to mention this,” he told Borderlex.

The treaty’s disintegration “would seriously hamper the ability of the world to meet the Paris climate targets,” Rusnák said. Unlike Paris, the ECT protects investments, he said, and so the two are complementary.

Fracking company sues Slovenia over ‘unreasonable’ environmental protections

In response to this point, Johnson said that renewable subsidies were important but “it is dangerous if we use the treaty to lock in unsustainable incentive schemes”. She said governments needed the ability to review and withdraw subsidies if they were not catalysing investment or were an “excessive” use of taxpayers’ money.

These talks were the second of three ‘clarification rounds’ this year, meaning that no substantive decisions were expected. There will be a further clarification round in November before a progress report is submitted to the ECT’s December conference and then negotiations will continue throughout 2021.

The post Energy companies keep right to sue states in private courts, as treaty reforms blocked appeared first on Climate Home News.

While the European Union is pushing for updates of the Energy Charter Treaty (ECT) to make it more climate-friendly, Japan has resisted any changes.

Ahead of a second round of negotiations on modernising the pact this week, Luxembourg’s energy minister Claude Turmes said in a webinar the EU might quit the treaty if there was no progress.

“I would not rule out that if nothing moves, if there is not sufficient movement, then you would have no other option than to collectively step out. That was also a discussion raised by France, although I can’t confirm the French government’s commitment,” he said.

Marjolaine Meynier-Millefert, a French lawmaker from president Emmanuel Macron’s party, said reform was preferable to ditching the treaty, but “if we are forced to do so then there would be no other option than to do so”.

On Tuesday, 139 lawmakers in the European Parliament issued a statement warning the treaty “is threatening the climate ambition of the EU domestically and internationally”. They said the EU should withdraw unless it can achieve a rewrite of the pact to scrap protections for fossil fuel investors.

Uniper uses investment treaty to fight Netherlands coal phaseout

The ECT is a pact signed in the 1990s to boost investment flows between western and post-Soviet countries. Provisions to deter states from grabbing private assets have been retooled by energy companies to fight climate policies.

Last year, German utility Uniper threatened to sue the Dutch government under the treaty, because a national plan to phase out coal burning would force the early closure of Uniper’s power station near Rotterdam.

The European Union has proposed amendments that reinforce governments’ “right to regulate” on issues like public health and the environment. But any changes must be passed unanimously and so can be blocked by any of the ECT’s 53 signatories.

A written submission from Japan published by the ECT secretariat in October 2019, before modernisation talks began, asserts 26 times: “Japan believes that it is not necessary to amend the current ECT provisions”.

Among the proposals rejected by Japan are language on the “right to regulate” and changes to the investor-state dispute resolution (ISDS) mechanism.

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Leaked ECT notes seen by Climate Home News show that, ahead of the first round of negotiations in July 2020, Japan expressed “great concerns” about an EU plan for a multilateral investment court to replace the ISDS.

Japan was supported in this by Kazakhstan. In the notes, both nations said “modernisation should be minimal”.

According to Yamina Saheb, a former head of the ECT energy efficiency unit and observer of the negotiations, the 12-strong Japanese delegation in July made no proposals to change the text and called for 2020 discussions to be limited to clarifying national positions.

Japan’s position as the largest single donor to the ECT and the vice chair of the modernisation negotiations means it is influential.

Pia Eberhardt, a researcher at Corporate Europe Observatory, told CHN Japan’s opposition means “it’s very unlikely that we will see any of the changes which we would need to see to make this agreement compatible with climate action”.

Countries promise green recovery at Japanese virtual summit, keep quiet on fossil bailouts

Japan’s reluctance to change the ISDS mechanism reflects the fact that, unlike many European countries, it has never been sued by foreign investors.

On the other hand, Japanese companies have used the ECT to take legal action against governments. So far, these have only been renewables companies angry at a decision by Spain’s previous government to cut subsidies and increase taxes – but fossil fuel companies could use the treaty in a similar way.

Japan is the only G7 country still building coal-fired power plants, both in Japan and overseas. According to Mission 2020, Japanese public finance is behind 24.7 GW of coal power in other countries. That is larger than Australia’s entire coal fleet.

These coal power plants are in India, Indonesia, Vietnam, Bangladesh, Chile and Morocco. None of these countries are signatories to the ECT but several are either in the process of acceding or are observers.

And in 2016, the Japanese government changed the law to allow its state-run JOGMEC agency to buy foreign energy assets.

Guterres tells India coal business ‘going up in smoke’ as investors back clean tech

Italy and Russia have left the ECT, although a ‘sunset clause’ means the treaty’s provisions apply for 20 years after they leave.

Russia withdrew from the treaty in 2009, when former shareholders of the Yukos energy company used the ISDS to claim compensation for assets they said had been expropriated by the Russian government.

Italy withdrew from the ECT in 2016. The government said this was to reduce costs associated with membership but it may also have been a response to renewable energy companies taking legal action over a reduction in solar power subsidies.

The post Japan blocks green reform of major energy investment treaty appeared first on Climate Home News.

With France, the Netherlands and Britain planning diesel bans by 2040, commission officials are said to view a new mandate as a natural step. The issue is fraught though, particularly in Germany where the car industry remains a powerful political force and elections are looming.

One source with knowledge of internal EU discussions told Climate Home that cabinet members in the bloc’s climate, industry, energy union and transport directorates had reached a consensus on the need for tough enforceable targets.

“They have made it very clear that it is their intention to go to a zero-emissions mandate and the car industry has been told to stop complaining about it, and start being constructive,” the source said.

A California-style mandate, obliging car-makers to meet a minimum fleet quota for electric vehicles is one option on the table.

“It is looking increasingly likely that they will come forward with a proposal of that sort for 2025 and 2030, probably including plug-in hybrids,” said the source.

There has been confusion about the EU’s intentions since last Monday, when commission spokeswoman Mina Andreeva told journalists that “no quotas for electric cars are being considered”. Nor could they be, she added, as the bloc was committed to technological neutrality.

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Contacted by Climate Home, Andreeva accepted that a binding target for ultra-low emitting vehicles was one of the options put forward for consideration by a commission paper last year. But this was different from a technology-specific quota, she argued.

“You have wording on targets for ultra-low emitting vehicles in the communication, so prima facie it’s out there,” she said. “But the distinction between targets and quotas is important as targets are much softer than quotas, which are legally enforceable.”

Despite this, Germany’s environment ministry reportedly expects a proposal that includes a quota on electric cars, as do commission cabinet members. EU diplomats in Brussels confirmed to Climate Home that they did too.

“It is under consideration,” one diplomat said, on condition of anonymity. “It is part of [the commission’s] brainstorming process.”

Targets for vehicle emissions in the EU have previously been legally enforceable, although that does not necessarily mean they will be under future legislation.

Commissioners are expected to discuss the proposal in a meeting next month, ahead of its release, which is due in November.

Report: German vice chancellor attacks China’s electric car targets

Next month, the European parliament will also vote on a proposal for a 25% minimum fleet quota for electric cars by 2025 and ban on diesel and petrol engines by 2035. MEPs have already backed tougher CO2 benchmarks for 2025 for 2030 and more cheat-proof testing.

If the new measures pass parliament, they will only be a signal of battles to come. The EU parliament can block, tweak or amend regulations in three-way negotiations with EU states, and with the commission. But the commission alone has the power to propose laws.

Moves to restrict pollution from the car industry within the EU commission and parliament have emerged as a hot button issue in next month’s German election. Earlier this week, chancellor Angela Merkel reversed a position that quotas were “not thought-through” under opposition fire, and backed an eventual diesel phase out, without committing to a date.

Merkel has previously warned about the dangers of “demolishing” the diesel industry. But there will have been relief in Germany’s car industry – a major historic contributor to her party – that she also pledged to maintain diesel’s current tax incentives.

The automobile sector is crucial to Germany’s economy and Merkel has not hesitated to use her clout in Brussels to protect its interests, as the industry sees them. 

During negotiations for the last CO2 auto standards in 2013, diplomats accused Merkel of going “rogue” behind the scenes, by threatening car plant closures unless an agreed EU plan was stalled.

Any similar manoeuvres after the Volkswagen ‘dieselgate’ scandal might further damage consumer confidence and the industry’s long term future, according to some green analysts.

Greg Archer, the director of clean vehicles at Transport & Environment, told Climate Home that without zero-emissions sales targets for 2025 and 2030, “European car companies will suffer the same catastrophic collapse Nokia experienced for failing to embrace new technologies”.

Car-makers in Europe say that emissions standards are a regulatory burden that place them at a competitive disadvantage. Critics argue the industry is highly profitable and will need to invest heavily in electric vehicles to remain in business.

Last month, European car manufacturers pleaded with China to weaken its ambitious roadmap for introducing electric vehicles, after an apparently unsuccessful bid by Merkel to slow green growth in the east Asian giant.

“The European car industry’s dream that they’d sell diesel to China and the US is dead [after dieselgate] and the European commission knows it,” said Archer. “They’re worried that they will finish up with an industry locked into old technologies that isn’t going to invest in the new solutions needed to maintain exports around the world.”

The post EU ‘increasingly likely’ to implement electric car quota, despite denials appeared first on Climate Home News.

Grin and bear it. Luxembourg environment minister Carole Dieschbourg needs to herd the 28 EU member states in Paris (Pic: UN Photos)

By Ed King

The European Union’s second smallest country boasts its highest level of fossil fuel subsidies per person, according to data published by the International Monetary Fund (IMF).

Luxembourg supports coal, gas and oil use within its borders to the tune of €3,415 a year, in the form of tax breaks and what campaigners say are “ultra-low” rates on transport fuel.

That’s around €1000 more than Bulgaria, the second highest provider of subsidies among the EU’s 28 member states.

As holders of the rotating EU presidency and head of the delegation to this year’s Paris climate summit, Luxembourg should make greater efforts to cut its support said James Nix, from Green Budget Europe, which highlighted the findings this week.

“To retain its credibility, and maintain that of the EU, Luxembourg needs to cut its fossil fuel subsidies before it enters December’s climate change negotiations,” he said.

On Monday the head of the OECD Angel Gurria described the attitude of top economies to tackling climate change as “schizophrenic”, querying their calls for tough action while offering handouts worth up to $200 billion to the fossil fuel sector.

Earlier this year the IMF estimated that over $5 trillion of subsidies were directed towards carbon polluting industries, a figure higher than previous estimates as it included the costs of climate change and the effects of emissions on health.

In an email to RTCC, Olaf Münichsdorfer, an advisor to Luxembourg environment minister Carole Dieschbourg, said the government was implementing revised tax rates and efficiency measures to slow emissions.

“While the Green Budget Europe press release refers to an IMF study that assimilates what it qualifies as “inefficient taxation” of fossil fuels to “subsidization”, it is worth pointing out that, contrary to other countries, Luxembourg does not directly subsidize fossil fuels and respects the tax directives,” he said.

Münichsdorfer added it was “regrettable” that the figures did not take into account the 165,000 non-resident commuters that travel through the country every day.

The post Luxembourg urged to radically slash fossil fuel subsidies appeared first on Climate Home News.