Although the European Union has the means and capacity to wave goodbye to fossil fuels by 2040, EU environment ministers have backed an unambitious climate target for that year that unfairly shifts some of the burden for domestic climate action to the Global South and future generations.

After months of delay, dithering and dispute, European Union member states have finally reached a deal on the bloc’s crucial 2040 climate target, albeit one that dangerously delays decarbonisation, which could trigger dangerous climate tipping points, and unfairly burdens those least responsible for the climate crisis. 

Although the Environment Council has kept in place the headline goal of shrinking the EU’s carbon footprint by a net 90%, this was achieved by introducing leaky loopholes and accounting sleights of hand, such as the use of international carbon credits to cover 5% of the bloc’s 1990 emissions.

“2,000 scientists declared that not only is ambitious climate action essential for planetary wellbeing, but that for the EU it is also an economic and competitive necessity. Yet EU governments lack the courage and imagination to act on this advice,” says CMW’s Executive Director Sabine Frank. “The compromise adopted by Council undermines the EU’s ability to achieve climate neutrality, ignores the EU’s historical and ongoing responsibility to tackle climate change and the scientific community’s advice to prioritise delivery of domestic emissions reductions.”

The European Scientific Advisory Board on Climate Change, an official EU advisory body, had recommended that the EU reduce its 2040 emissions by at least 90-95% without any flexibilities. It is also entirely feasible for the European Union to achieve climate neutrality by 2040, a full decade before the official 2050 target date, research and modelling have indicated.

Two steps back

Unfortunately, the new 2040 target now jeopardises the EU’s chances of completely decarbonising its economy by mid-century by risking the emergence of an unbridgeable gap in 2040. “One step forward, two steps backwards: salvaging the EU’s 2040 climate target came at the cost of allowing EU member states and industry to emit more greenhouse gases,” observed CMW Policy Director Sam Van den plas.

The Council’s deal allows for international carbon credits generated under Article 6 of the Paris Agreement to offset up to 5% of the EU’s 1990 emissions, up from the already high 3% proposed earlier this year and opposed by civil society and the scientific community. This means that the effective target is only 85% at best. 

The 5% measure could cost up to €48.9 billion and result in EU emissions being 50% higher than under a fully domestic target, according to CMW calculations, and assuming even a conservative price of €70 per credit. Under the previous 3% proposal, this would have led to EU emissions being 30% higher, a previous CMW analysis revealed.

This is further undermined by additional loopholes which would enable the Commission to further adjust downwards the target based on potential shortfalls in the land use and forestry sectors, and a last-minute addition which could allow member states to also use extra international credits to fulfil up to 5% of their post-2030 targets and efforts. 

“Climate sceptic countries got their wish list of loopholes approved. Rather than taking responsibility for fulfilling their obligations (and reaping all the social and economic benefits that come with that) countries have given themselves the right to move the goal posts at will. The damage done to the EU’s credibility in the international arena, and to the trust of its citizens demanding climate action is substantial.” said Wijnand Stoefs, EU policy lead at CMW.

“Governments must do more to protect and restore their natural ecosystems in order to reach their [land use] targets, while simultaneously slashing their emissions and developing sustainable permanent removals,” explained CMW’s Lead on Carbon Removals Fabiola De Simone. “EU countries should have agreed on separate targets, and any uncertainty about the deployment of carbon removals should have resulted in higher gross emissions reduction targets, not lower.”

Paying polluters

These “flexibilities”let major polluters off the hook, undermining the ‘polluter pays’ principle enshrined in EU law. But this capitulation to fossilised fossil fuel interests does not stop there. 

The deal agreed by the Council could disrupt the effective functioning of the EU’s Emissions Trading System, by relaxing restrictions on the maximum permitted emissions after 2039 and allowing the entry of permanent removals into the EU ETS. 

Environment ministers also support delaying the phasing out of free allocations to heavy industries from 2028, which would translate into at least €20 billion of foregone government revenues. The Council also asked to postpone the Emissions Trading System for road transport and buildings (ETS2) by a year, which is something CMW has opposed previously.

Passing the burden

Beyond the environmental and economic cost, these loopholes are costly in terms of climate justice. 

Relying on international credits instead of investing in domestic decarbonisation only postpones the inevitable transition, imposing an unfair burden on future generations of Europeans.

This reliance on Article 6 carbon credits would also shift responsibility for part of the EU’s domestic emissions to communities in the Global South who did little or nothing to create the climate crisis. Not only is the Article 6 framework set up in a way that risks exacerbating existing inequalities, the EU purchasing credits may make it harder for those countries to reach their own climate goals.

Although the window of opportunity to establish a fair and effective 2040 target is rapidly shutting, it is not too late. As co-legislator, the European Parliament still has the opportunity to push back against this severely watered-down target and negotiate a resumption of the original 90% target without backdoors. Failure to do so would cost European society and the environment dearly.

“EU policymakers need to urgently recalibrate their efforts towards delivering real climate action, instead of finding easy ways out,” urged Van den plas.