EU’s Fit for 55 climate package will overhaul the continent’s economy

20 Jul 2021

Image: © promesaartstudio/Stock.adobe.com

If implemented, the legislation will revolutionise climate policy in Europe and affect the daily lives of almost half a billion people.

The European Commission has rolled out its Fit for 55 climate legislation package to transform Europe into the world’s first climate-neutral continent by 2050.

Adopted on 14 July, the proposals will upgrade EU climate, energy, land, transport and tax policies to align with the bloc’s climate objectives.

Fit for 55, coined by EU Commission president Ursula von der Leyen, aims to reduce the EU’s net greenhouse gas emissions by at least 55pc on 1990 levels by the end of this decade.

It comes a month after the adoption of the landmark European climate law that etched in stone the bloc’s commitment to achieve carbon neutrality by mid-century.

The Commission said the proposals present legislative tools to deliver on the targets agreed in the European Climate Law and fundamentally “transform our economy and society for a fair, green and prosperous future”.

Fit for 55 proposes to tighten the EU emissions trading scheme and extend it to new sectors. It will also increase the use of renewable energy and speed-up the roll-out of low-emission transport modes and the fuels to support them.

The EU emissions trading system puts a price on carbon and lowers the cap on emissions from certain economic sectors every year. It has successfully brought down emissions from power generation and energy-intensive industries by 42.8pc in the past 16 years.

If implemented, Fit for 55 will also align member states’ policies with the objectives of the European Green Deal and create measures to prevent carbon leakage.

Von der Leyen said the fossil fuel economy has reached its limits and that the next generation deserves to be left with a healthy planet with good jobs and growth that “does not hurt our nature”.

“Europe was the first continent to declare to be climate neutral in 2050, and now we are the very first ones to put a concrete roadmap on the table. Europe walks the talk on climate policies through innovation, investment and social compensation,” she said.

Kadri Simson, EU commissioner for energy, said that the Fit for 55 proposals set more ambitious targets, remove barriers and add incentives to move even faster towards a net-zero energy system.

But not everyone was happy about the package.

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The European Environmental Bureau (EEB), a network of environmental citizens’ organisations, said that the EU’s Fit for 55 package is “unfit and unfair”.

The network, which represents organisations based in more than 30 countries, said that the commission is missing another historic opportunity to phase out fossil fuels in the package.

Fit for 55 leaves the door open for coal, gas and oil to stay in the EU energy system for at least another two decades while making EU citizens pay the price, the EEB said.

Barbara Mariani, EEB policy manager for climate, said: “What the Commission says is ‘Fit for 55’ is unfit for our planet and unfair to society. Without a fossil fuel phase-out, the fuel industry will pass on emission costs for buildings and transport to citizens and still keep making immense profits.”

Mariani added: “Europeans will be asked to pay to save the fossil fuels industry. We are wasting the unprecedented financial potential of the EU recovery package to lock Europe into polluting and climate change-inducing practices when we should be reducing our ecological footprint and avoiding the worst impacts of the climate crisis.”

The group argued in a public announcement that the targets for renewable energy and energy efficiency are far below the level of ambition needed to keep global warming below 1.5 degrees Celsius and they are not binding at national level.

“This will delay the energy transition in the member states, since the current EU climate and energy governance framework has proven insufficient to fill the gap,” the EEB said.

The response in Ireland has been more welcoming.

Stephen Prendiville, head of sustainability at EY Ireland, said that the proposal is a critically important signal for businesses, investors and citizens, that “we are now committed to a further period of rapid change in our decarbonisation journey”.

However, Prendiville added, for Ireland to be a destination for investment and expertise in the new EU economy, it must pass clear and comprehensive legislation and regulation to plan ahead.

“We already know that current policy interventions in Ireland will only get us to about half of our 2030 targets so there is now a real opportunity for Government to set out its stall in a comprehensive and robust manner,” he said.

“We need policy enacted to signal to business and investors that big changes must be accommodated in everything from mobility to energy systems, to our built environment. We also need solid mechanisms in place in terms of incentives and subsidy structures, clarity of planning process requirements and more.”

Vish Gain is a journalist and copywriter with Silicon Republic

editorial@siliconrepublic.com