12 December 2019 – Following the unveiling of Europe's Green Deal, CLG Europe responds to the key points detailed in this roadmap towards a carbon neutral Europe by 2050.
CLG Europe Senior Advisor Dr Martin Porter said:
“We welcome this ambitious and far-reaching plan that can act as the new growth strategy for the EU, cutting emissions and delivering jobs.
“The breadth of the European Green Deal indicates how seriously the transition to a net zero economy is being taken by the Commission and that the need for systemic change is understood to be at the heart of any workable decarbonisation strategy. Its wide-ranging scope – including, energy, agriculture, industry, transport, sustainable finance, and a new climate law – will need joined-up policy development as well as buy-in from all Commissioners to have climate neutrality as a core goal.
“Putting climate change at the top of Europe’s agenda will provide business and investors with the clarity and confidence to invest in sustainable, net zero emissions industries; this is turn will progress innovative thinking and help protect European competitiveness.
“There is much to praise within the text and intent of the Green Deal but its ultimate success will be judged at the end of this Commission term against its ability to set Europe on a Paris-aligned path by 2030. We urge the other EU institutions, as well as their stakeholders, to work with similar urgency and ambition to turn the Green Deal into concrete decisions enabling real action on the ground and in boardrooms immediately.”
CLG Europe overview analysis of the European Green Deal
The European Corporate Leaders Group (CLG Europe) welcomes the ambition of the European Green Deal, and its breadth – that rightly seeks to deal with climate change as one of the main factors shaping the future of the European economy and sets out how it must shape the European policy agenda from energy to finance and from industry to agriculture.
President von der Leyen’s view that it is the new growth strategy of the EU, cutting emissions and creating jobs is fully in line with CLG Europe’s view that the EU must develop a new economic strategy that delivers prosperity for EU citizens, develops industries able to compete in new markets, and addresses our environmental impact.
For the European Green Deal to succeed it will need to leverage the strengths that the EU can bring to the climate challenge: market scale, effective standard setting, strong science, knowledge and skills base and effective environment governance. Given that the Green Deal is dealing with the full spectrum of a broad economy transition, but that different members of the Commission team are responsible for finance, industry and other aspects, it will be critical to ensure joined-up policy making and for all Commissioners to have achieving the Green Deal and climate neutrality as their core goal.
By the end of this five year institutional cycle, the European Green Deal will need to be judged by its ability to have set Europe on a path to success by 2030, by which time we shall know if the goals of the Paris Agreement will be met. Putting climate change at the top of Europe’s agenda will provide business and investors with the clarity and confidence to invest in the sustainable, net zero emissions industries of the future, driving innovation and protecting European competitiveness on a global scale.
Earlier this year, in a letter to EU Heads of State, business leaders, including members of CLG Europe, wrote: ‘Collectively, we have an urgent task. To decarbonize the global economy in little more than a generation. Europe led the last industrial revolution. We believe it must lead the next one. This is essential to achieve a prosperous and secure future for Europe.’
- We welcome the scope of the Green Deal and the recognition of the need to deeply transform the economy to achieve climate neutrality by 2050. The Green Deal Communication is a good initial roadmap, however, achieving this transition will require developing a comprehensive, coherent and cross sectoral approach that will create synergies between various sectors within a robust and ambitious policy framework.
- We welcome the proposal for a European Climate Law that will enshrine the pathway to climate neutrality by 2050 in legislation and that the Commission has moved towards presenting an impact assessment on increasing ambition in 2030 to 50 of 55 per cent by Summer 2020. In our view it is critical that this results in an updated target of at least 55 per cent being submitted to the UNFCCC by October 2020.
- We support the need to further decarbonise the energy sector, increase access to clean energy and energy efficiency, and address ambition gaps in national energy and climate plans. However, it is critical that these are aligned with plans to address building and renovating in an energy and resource efficient way and the new strategy on sustainable and smart mobility. We are calling for a smart and integrated approach to energy, mobility and buildings. These sectors are undergoing rapid transformation, led by low-cost renewables, battery and other energy storage developments, new technologies and business models.
- It will be critical for the new European industrial strategy to be a central and integral element of the Green Deal and its aim to deliver climate neutrality by 2050. Recent studies show that reducing CO2 emissions from heavy industries to net zero by 2050 is technically feasible and financially possible, and can have multiple social and economic benefits. The industry strategy should address innovation, investment, ensuring greater circularity at the heart of industrial policy, how best to align energy plans to support the transition and the strategic policy framework necessary to enable this shift. As such, we welcome the link between the upcoming industrial strategy and the new circular economy action plan given the potential of materials recirculation in terms of GHG emissions reductions. The industrial strategy is clearly linked to other core proposals, innovation financing, energy taxation and the new Action Plan on Green Financing.
- A new approach to food, agriculture and land use is needed – not only to decarbonise, but also to protect biodiversity and ecosystem services, and ensure that the land that Europe relies on remains able to support us and our economy. A ‘regenerative’ approach to land use is possible and will require changes to both production systems and consumption patterns. We welcome the Commission’s move to address nature-based solutions and a fair, healthy and environmentally friendly food system. There is growing consumer demand for sustainable food, materials and products, which is creating major opportunities linked to accelerating innovation in food, forestry, land management and agriculture technologies and approaches, and in the wider bio-economy.
- An acid test will be the integration of the new and more ambitious push around sustainable finance, which will be a key determinant for businesses in making the investment case in Europe. Enabling private capital to flow into European businesses and value chains at the pace and scale necessary remains a major challenge. We welcome the Commission’s plans to develop a Sustainable Europe Investment Plan, ensure that various EU funds contribute to increasing investments in a climate neutral economy, work closely with the European Investment Bank in this process and look at synergies between the Sustainable Europe Investment plan and the Just transition Mechanism. A renewed Sustainable Finance Strategy will have to address both the need to facilitate access to public and private sector funds and new innovative funding mechanisms, as well as integrate environmental sources of risk into the prudential regulatory framework and align company reporting and investment via the sustainable finance taxonomy.
- In the end, public support will be required for this major transition of the economy, and mechanisms to include European citizens and support a fair and just transition, we look forward to seeing the full proposals on the Just Transition Mechanism and the Climate Pledge. To maximise the impact of the European Green Deal in both Europe and internationally, it should be socially just within Europe as well as for other countries. We are sensitive to the impacts that come with economic transition of any kind. These must be planned for and embraced with a strong sense of social justice and equity, ensuring that those who stand to lose in the transition to low carbon are treated with dignity, fairness and provided with opportunities and jobs in the new economy.
- A key challenge for Europe will be to manage and develop its trade relationships to secure and incentivise the transition to a zero carbon economy, whilst not creating unnecessary confrontations with other economies.
