European Union Calls for 90% Cut in Emissions

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Written by Martin Lynch, European News Editor for Industrial Info (Galway, Ireland)--Europe is proposing an ambitious target of a 90% reduction in greenhouse gas (GHG) emissions by 2040 but has pulled back on previously seen targets for the agricultural sector.

The goal has been set out in order to start the process of getting European Union (EU) Member States on board in the coming years. Europe is currently working on achieving its 2030 target of reducing emissions by 55% compared to 1990 levels, using its "Fit for 55" legislation. For additional information, see July 26, 2021, article - EU Reveals Sweeping Climate Change Plans.

Reaching its 2040 goals, the Commission said, will require the "full implementation of the agreed 2030 framework, ensuring the competitiveness of the European industry, a greater focus on a just transition that leaves no one behind, a level playing field with international partners, and a strategic dialogue on the post-2030 framework, including with industry and the agricultural sector." It stated that the energy sector is projected to achieve full decarbonisation shortly after 2040, based on all zero and low carbon energy solutions, including renewables, nuclear, energy efficiency, storage, carbon capture and storage (CCS), carbon capture and utilization (CCU), carbon removals, geothermal and hydro. There will be a lower dependence on fossil fuels, with an 80% drop in their consumption for energy from 2021 to 2040.

An earlier draft of the current EC emissions proposals seen by Reuters proposed that the agricultural sector would have to cut non-CO2 emissions 30% by 2040 from 2015 levels to comply with the overall climate goal. That was left out of the final draft. Industrial Info recently reported that the Commission was scrapping controversial plans to cut the amount of fertilizers used in the EU by 50% by the end of the decade. It followed disruptive protests by farmers across Europe in recent weeks and the rejection of the proposed Sustainable Use of Pesticide Regulation (SUR) by many Member States. For additional information, see February 12, 2024, article - Europe Scraps Fertilizers Ban. Many of Europe's traditional industries such as steelmaking and chemicals, as well as its growing renewable energy and clean-tech businesses, are under increased pressure from China. Europe is also struggling to combat the impact of the U.S. Inflation Reduction Act (IRA), which made US$216 billion of climate and energy funding available to businesses, much of it in the form of tax credits. It has made the U.S. a more attractive location to set-up green-tech manufacturing operations.

"Europe has already made a strategic decision to invest in an innovative, sustainable and globally competitive economy, centered around agile clean industries," said Maros Sefcovic, executive vice president for European Green Deal, Interinstitutional Relations and Foresight. "Today, we are taking the next step to achieve just that, with an overarching aim to bring long-term prosperity, stable jobs, and the EU's greater economic security. We see industrial leadership and just transition as two sides of the same coin. As a strong global player in net-zero technologies, the EU will continue to keep fairness and solidarity front and center of the European Green Deal."

The Commission believes that the new targets will "send important signals on how to invest and plan effectively for the longer term, minimizing the risks of stranded assets." It also contends that it will boost Europe's resilience against future crises and notably strengthen the EU's energy independence from fossil fuel imports, which accounted for more than 4% of gross domestic product (GDP) in 2022 as "we faced the consequences of Russia's war of aggression against Ukraine". The Commission also noted the "costs and human impacts of climate change" on Europe are increasingly large and visible. In the last five years alone, climate-related economic damage in Europe was estimated at 170 billion euro (US$183 billion). The Commission's impact assessment finds that, "even by conservative estimates" higher global warming as a result of inaction could lower the EU's GDP by about 7% by the end of the century.

Investment and legislative change will be the key to hitting its targets. The Commission claimed that its Green Deal now needs to become "an industrial decarbonisation deal" that builds on existing industrial strengths, like wind power, hydropower, and electrolysers, and continues to increase domestic manufacturing capacity in growth sectors like batteries, electric vehicles (EVs), heat pumps, solar PV, CCU/CCS, biogas and biomethane, and the circular economy. "Carbon pricing and access to finance are also critical for the delivery of emission reduction targets by European industry," it stated. "The Commission will set up a dedicated taskforce to develop a global approach to carbon pricing and carbon markets. Europe will also need to mobilize the right mix of private and public sector investment to make our economy both sustainable and competitive. A European approach on finance will be needed in the coming years, in close cooperation with Member States."

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