Takeaways from Europe’s fit for 55 climate plan

🔎  What’s going on?

Last week, the European Union (EU) announced proposals called the ‘Fit for 55’ climate package. These aim to reduce the region’s greenhouse gas emissions by 55% by 2030 (compared to 1990 levels). And be on track to hit net zero by 2050.  

🇪🇺  Cool, tell me more!

The package contains 13 proposals to help deliver the so-called European Green Deal. The main objective of any green deal is to eliminate or offset a nation’s greenhouse gas emissions by 2050, in line with the Paris Agreement. 

Back to the Fit for 55 climate package, here’s a short rundown of the 13 proposals:

1. Stronger EU emissions trading system (ETS) which now includes aviation, shipping, road transport, and buildings. The biggest revamp to the policy since it was launched in 2005.
2. Revised land use, land-use change, and forestry regulation call for a target of 310MtCO2e of carbon removals by 2030. This target would be divided between member states. 
3. Revised effort sharing regulation ensures that all member states contribute in a ‘fair and just manner to reducing EU-wide emissions, with national targets set based on GDP. It’s now proposed that emissions are reduced by at least 40%.
4. Revised alternative fuels infrastructure directive will make it easier to recharge and refuel vehicles across the bloc. Particularly for those switching to electric vehicles and hydrogen-powered trucks.
5. Updated energy taxation directive to remove the full exemption for aviation and shipping sectors. This ‘loophole’ is equivalent to receiving fossil fuel subsidies! A new structure of linking tax rates to the energy and environmental performance of fuels and electricity has instead been proposed. This will ensure that the most polluting fuels are taxed the highest.
6. Updated energy efficiency directive to keep energy use to 39% below projected levels in 2030.
7. Updated renewable energy directive to increase the 2030 target for renewables from 32% of the EU energy mix to 40%. 
8. Revised emissions standards for new cars and vans now propose that emissions from new cars drop to zero by 2030.
9. New EU forest strategy aims to adopt stronger and more transparent rules for forestry and commit to protecting all primary and old-growth forests. Plus a roadmap for planting at least 3 billion new trees is included. 
10. New ReFuelEU initiative would require an increasing amount of sustainable aviation fuels (SAFs) to be blended into the fuel mix used by aircrafts. The rate starting at a minimum of 2% in 2025, would increase every five years. 
11. New FuelEU initiative for cleaner shipping fuels will see greenhouse gas intensity targets that will increase over time. 
12. New carbon border adjustment mechanism (CBAM) is basically a carbon border tax that would come into force in 2023 to avoid ‘carbon leakage’. Carbon leakage happens when businesses move production to other countries where climate policies are weaker or non-existent. This ultimately leads to an increase in total emissions. It’s mainly for 5 sectors: iron and steel, aluminum, cement, fertilisers, and electricity. 
13. New social climate fund to support the vulnerable groups to adjust to higher costs of energy, heating, and transport.

❓ Why should I care?

It’s important to note that these proposals are transformative, especially because a lot of these have not been updated so drastically since their inception in many cases! It is not entirely sufficient on their own, however, it’s historic given the scale of impact and the number of countries involved. These legislations will touch every part of the economy and every industry. More importantly, it will impact us, consumers, this decade.   

This Fit for 55 climate package makes it very clear that this transition to net-zero will be market-led first and foremost. 

🚦 Where do we need to be?

Even though a lot of these proposals are transformative, it’s sadly not enough. These proposals are ambitious, especially when compared to the US and China but it’s still insufficient. Simply put, the proposed climate package does not support climate science nor the Paris Agreement of keeping emissions below 2°C. Plus, implementing all the proposed legislations is a very difficult task all on its own and most likely, the majority of these will be watered down by the time they are enshrined into law. 

We need even more ambitious climate proposals that can be implemented much more quickly and perhaps even more importantly, we need industries and businesses to support or even better to lead these legislations. 

👤  What can I do about it?

As an individual, every pound, dollar, or euro you spend is a signal to the ‘invisible’ market forces we live under. So make it count. Ensure you support products and services that are drastically reducing carbon emissions. Switch products and services if you have to. Check out the CoGo app to shop more sustainably today. 

As a business, measure, reduce, and avoid emissions. Decarbonise your supply chain as quickly as possible to retain a competitive advantage over others in your industry. Be a climate leader. 

Related: UN publishes Paris style biodiversity plan