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Make your mind up time for the EU on Paris

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EU’s response to Paris

In the run-up to today’s European Council meeting in Brussels, the Paris climate agreement was on the agenda, off the agenda and – at the time of writing – is now back on again. With a burgeoning agenda on the refugee crisis, EU President Tusk’s team had initially been fearful of further divisions over the EU’s climate ambition, but several countries pushed for the European Council to formally reaffirm commitment to the Paris Agreement. There have also been signs of movement from a European Commission plan to revise the EU 2050 climate roadmap, with their public statements noticeably stronger than their written assessment. What comes out of this week’s Council will signal whether the EU can make up its mind on what the Paris Agreement really means.

Earlier this month, almost half of EU Environment ministers called for greater EU climate ambition in light of the Paris Agreement, and for the EU to be ready for global facilitative dialogue in 2018. Many said the Commission assessment hadn’t captured the ambitious spirit of Paris. This included the UK, Germany, France, Sweden, Belgium, Austria, Portugal, Slovakia and Luxembourg.

It’s clear that most EU countries get the political importance of Paris. President Juncker seems to be putting the short term political concerns of the Commission, like fear antagonising Poland, ahead of the real interests of European citizens, but there’s a chance to turn this around.

Countries are moving ahead

With or without the Commission, governments, businesses and cities are moving ahead with implementing the Paris Agreement and this will determine its true success in the real economy. Right off the back of COP21, France announced they would increase their 2020 climate targets. In January, the UK Climate Change Committee committed to assess how the long-term ambition in the Paris Agreement affects the UK 2050 target and beyond. Germany is coming out with a 2050 climate protection plan later this year which will include coal phase out.

This political momentum is being carried globally. China has indicated they will likely far surpass their 2020 targets and may have already peaked their emissions ahead of their 2030 deadline. Moreover, the Chinese 5 year plan is expected to bring in major reforms to boost investment in clean energy. China plans to add around 400GW of additional clean energy by 2020, with investment amounting to €310 billion.

The financial sector is also moving. Following the Bank of England’s warnings in November 2015 about the stability of the financial sector with climate impacts, the European Systematic Risk Board has mirrored calls for asset disclosure and stress testing exposure to risk. This has been followed by Swedish and Dutch financial regulators in the past days.

What’s the impact of the Commission’s weak response?

In the short term, there won’t be a strong, coherent European response to Paris. We’re likely instead to see a fragmented one with a series of individual debates through the hefty EU climate and energy legislative agenda this year, starting with the Effort Sharing Decision Directive and Emissions Trading Scheme reform.

There’s a real risk of inconsistency on EU climate and energy policy without a clear set of Post-Paris objectives setting the guiding principles for new legislation. Commissioner Canete has been publicly been supporting greater ambition on energy efficiency, calling for stronger target and his team are planning a series of policies to support it. But at the same time, the Commission just announced a major expansion in gas infrastructure that’s clearly inconsistent with the low carbon track agreed in Paris.

Yet, it’s still all to play for. If the majority of EU countries that spoke out at the Environmental Council remain ambitious, and keep carrying that momentum and commitment through all the EU energy legislative proposals this year, it demonstrates that the EU is serious about implementing Paris.

The Commission has effectively handed over climate leadership to Member States and the European Parliament. But, if the 2030 climate and energy discussions are anything to go by, that means we’re likely to see continued calls for greater ambition. The EU’s showdown on the implementation of the Paris Agreement has just begun.

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