European climate programme – Fit for 55
The European Commission presented its climate plan, dubbed Fit for 55, which calls, in its first stage, for the introduction of a carbon tax from 2023 on imports of steel, fertiliser and aluminium as well as trade in CO2 emissions and the use of renewable energy sources and electric vehicles.

The document was presented by EU Commission head Ursula Von der Leyen and five key EU commissioners. The aim of the programme in fighting climate change is to reduce CO2 emissions by 2030 by at least 55 % compared to 1990 levels and to further reduce that to zero by 2050.

    This will mean the complete rebuilding of the EU’s economy. The programme provides for more active use of clean technologies by companies and households, including renewable sources of energy and electric vehicles. The proposed measures are intended to reduce emissions in all segments of the European economy, including power generation and the car and housing sectors, in addition to shipping, aviation and agriculture.

    One of the key provisions of the programme is the introduction of A “Carbon Border Adjustment Mechanism”, involving the collection of a tax on goods imported by the EU, depending on the carbon footprint. As part of the first three years of operation of the system from 2023, the tax will apply to imports of steel, cement, fertiliser and aluminium. By introducing this mechanism, the Commission seeks to protect its producers, inasmuch as toughening climate regulations increases their costs and has a negative effect on their competitive position compared to producers in countries where rules are less stringent. In addition, the EU’s Commission believes the measure has to prompt a reduction of emissions outside the EU.

    Another fundamental point of the EU’s climate programme is the expansion of the existing programme in trade in quotas for CO2 emissions (ETS – Emissions Trading System) to include new sectors, a measure aimed at speeding up the decarbonisation process. Brussels wants to impose quotas on emissions produced by cars or by the heating of buildings.

    The ETS system establishes a price for emissions and every year lowers the limit of emissions permitted in specific sectors of the economy. And the Commission has proposed lowering those limits at an even faster rate. Over the past 16 years, emissions in electricity generating or in sectors with a high energy content have fallen by 42.8 percent, an EU statement said. And the EU intends to toughen emission standards for new cars over the next 15 years.

    These stated aims amount for all intents and purposes to a ban on imports of all diesel and petrol cars by 2035. In addition, new rules will be introduced calling for easier access to charging stations as part of measures to prompt consumers to make the transition to electric vehicles.

    On major roads, charging stations are to be installed at every 60 km for electric vehicles. Hydrogen filling stations are to be put in place every 150 km.The aviation and shipping sectors are also to be subject to punitive measures for polluting the environment – an appropriate tax is to be introduced for the first time. Shipping will also fall into this category from 2023.

    EU member states share responsibility for removing CO2 from the atmosphere and a provision on land use snd management of forests and farm land sets a common EU goal by 2030 of removal by natural carbon sinks of the equivalent of 310 million tonnes of carbon dioxide emissions.

    “Energy production and use accounts for 75% of EU emissions, so accelerating the transition to a greener energy system is crucial,” the Commission said in its statement. The declaration on renewable energy sources sets an even loftier aim – “to produce 40% of our energy from renewable sources by 2030”.

     The Commission’s proposals won the support of a number of EU member states. But, the Financial Times writes, EU governments and the European Parliament must still work out the details of the climate programme. These measures must be approved by the European Parliament and the EU Council before they can be put into effect.

    The European Commission proposed setting up a fund by 2032 worth 144.4 billion euros to ease the “social effects”’of the transition to a “clean economy”. The fund is to provide EU member states with financing totalling 72.2 billion euros from 2025-2032 by altering the EU’s financial framework, in place for many years.

    “This is going to be hard,” the Commission’s Deputy Head and its climate chief, Frans Timmermans, told reporters in Brussels, referring to all the tasks that lie ahead for the organisation.


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July 2021