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EU taxonomy: Europe’s sustainable leadership takes massive blow

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EU flag logo on the European Parliament 'Paul Henri-Spaak' building in Brussels, Belguim. Photo bu Guillaume Perigois via Unsplash.
EU flag logo on the European Parliament ‘Paul Henri-Spaak’ building in Brussels, Belguim. Photo bu Guillaume Perigois via Unsplash.
  • The European Parliament has refused to veto the Commission’s proposal to include gas and nuclear in the EU Taxonomy for sustainable activities. 
  • With this decision, the European Parliament has forsaken the scientific and market integrity of the EU Taxonomy, which should be a science-based transparency tool for sustainable and green capital markets. 
  • This was the last chance to correct this proposal through political processes. As of January 2023 gas and nuclear will be part of the EU Taxonomy if the expected legal challenges are unsuccessful. 

Story 

Today, the European Parliament voted on a resolution to veto the criteria for fossil gas and nuclear energy proposed by the Commission in February to be included in the EU Taxonomy of sustainable economic activities. With 328 against and 278 in favour of the resolution, MEPs failed to block the proposal. 

This was the final political opportunity to prevent gas and nuclear from being classified as green. Now the Complementary Delegated Act on the EU Taxonomy of Sustainable Activities is approved and enters into force and will be applicable as of January next year. However, the Taxonomy saga will not end here, as several member states have already indicated to challenge the delegated act in court.   

In light of the ongoing war in Ukraine and EU’s response through RePowerEU to free itself from Russian fossil fuels policymakers has been extremely divided over the role of gas and nuclear power in the climate transition. The vote today and the extreme politicisation of this technical issue indicate that, despite the outcome, Europe will stay divided on the topic for years to come. 

Quotes 

Jurei Yada, Programme Leader, EU Sustainable Finance, E3G said: 

“With the ongoing war, high energy prices and increasing cost-of-living crisis, it is disappointing to see how MEPs failed to recognise the urgency to block this. The Delegated Act is at odds with the EU’s response to the war, with RePowerEU and is counterproductive to achieving Europe’s energy independence”. 

Tsvetelina Kuzmanova, Policy Advisor, Sustainable Finance, E3G said: 

“We have now officially validated greenwashing by law. The process and the decision have been entirely political, not scientific, to only benefit a small number of Member States. This would not stand a chance in court and will only create more uncertainty for financial markets and jeopardize EU’s climate ambition.” 

Johannes Schroeten, Policy Advisor, E3G said:    

 [English] “Financial markets, European citizens and the EU’s own climate bank have made perfectly clear that taxonomy’s usefulness will be severely implicated by labelling gas and nuclear as green. But vested interests seem to have gotten the upper hand. The EU has now set a dangerous precedent of low ambition for other countries and jurisdictions to follow.” 

[German] „Die Finanzmärkte, die europäischen Bürger und die Europäische Investitionsbank haben deutlich gemacht, dass die Anwendbarkeit der Taxonomie durch die Kennzeichnung von Gas und Kernenergie als grün beeinträchtigt wird. Aber Lobbyinteressen haben die Oberhand gewonnen zu lasten eines wissenschaftsbasierten Ansatz. Die EU hat nun einen gefährlichen Präzedenzfall mit geringen Ambitionen geschaffen, dem andere Länder folgen werden.“ 

Available for comment 

Tsvetelina Kuzmanova, Policy Advisor, Sustainable Finance 

m: +32 (0) 483 989 651 tsvetelina.kuzmanova@e3g.org   

Johannes Schroeten, Policy Advisor, Sustainable Finance (German, English) 

m: +49 (0) 160 9596 4443, johannes.schroeten@e3g.org 

–  ENDS – 

Notes to Editors 

  1. E3G is an independent climate change think tank with a global outlook. We work on the frontier of the climate landscape, tackling the barriers and advancing the solutions to a safe climate. Our goal is to translate climate politics, economics and policies into action. About – E3G
  2. For further enquiries email press@e3g.org or phone +44 (0)7783 787 863

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